The average single coverage premium for each private sector employee enrolled in a health insurance plan was $6,972 in 2019. This was up 3.8% from the prior year MEPS data. Table I.C.1 shows average premium by size of company, industry, for-profit vs nonprofit, union establishments vs nonunion, and other breakouts. For companies of less than 10 employees, the average single premium was $7,528 per month. Report on private-sector establishments, from the Medical Expenditure Panel Survey (MEPS) Insurance Component summary tables.
On average, 2020 individual premiums were under $600 per month for a plan on last year’s health insurance exchanges, as of February 2020. Across all states, the average premium in February was $576 for the plans selected by individuals, compared to about $591 in the prior year. About 86% of people received the Advance Premium Tax Credit (APTC) (which is based on income) to bring the net cost to individuals, down to about $85 per month. The difference (about $492 per month) is covered by the government (“Obamacare”). Average cost varied by state. Nine (9) states (CO, MA, MI, MN, ND, NM, NV, RI, UT) had average monthly premiums under $500, before factoring in the APTC. Highest average premium states were West Virginia at $984 ($170 per month, with premium tax credit), Wyoming at $957 ($42 with premium tax credit) and Iowa at $818 per month ($15 with APTC). The national average premium of $576.16 per month works out to $6,914 premium cost per year. Source report from CMS, July 23, 2020, Early 2020 Effectuated Enrollment Snapshot.
Citizens’ Health Care Working Group: Final Recommendations, September 25, 2006. After input from more than 14,000 engaged citizens, the national working group delivered its recommendations to the President. Six recommendations called for immediate action and public policy that all Americans have affordable health care; that quality and efficiency be improved, and end-of-life-care be reformed. In recommending that core health care benefits and services be defined, it shares data that the people think consumers and medical professionals should define these benefits, rather than insurance companies. The group calls for affordable access to health care to be achieved by 2012. Summary and Appendix C (poll results) should be required reading for Congress and White House staff. Unfortunately the survey left out the question of how to encourage personal responsibility for exercising, eating right, and other healthy behaviors. Still, Editor’s Pick. It’s a classic.
Analysis by the American Hospital Association shows that Medicare and Medicaid under-pay the true cost of hospital care by about $76 billion. This cost ends up being borne by other payers and commercial insurance. Using 2019 data, it is estimated Medicare pays 87 cents on the dollar, and Medicaid pays 90. January 2021 report.
CMS reported average rate changes in health insurance premiums for 2021 on the federal exchange marketplace for two types of sample consumers – a 27 year old, and a family of four. The premium cost for the second-lowest cost silver plan is reported to be reduced by 2%, on average, for the 2021 enrollment currently underway. The healthcare.gov exchange opened on November 1, 2020. No information about average price hikes or reductions were presented for older consumers. Also not disclosed in the CMS press release, Oct. 19, 2020, is the increase in the size of deductibles.
According to CMS, the average silver plan premium for a 27 year old is expected to be $389 per month in 2020 and $379 in 2021. Older enrollees pay more, but costs for older consumers in 2021 were not disclosed in the press release. (For reference, the average premium paid by all enrollees in 2018 was $594.17, since the average enrollee is older than 27 years of age. AARP noted that a 2019 Kaiser Family Foundation report found that a 60-year-old not eligible for subsidies paid $708 a month for the lowest-cost bronze plan and $943 a month for the lowest-cost silver plan.) Open enrollment closes December 15, 2020.
What impact will COVID-19 have on health insurance rate increases for 2021? According to the American Academy of Actuaries, the COVID-19 pandemic has introduced new uncertainties into developing premium rates for 2021. As we know, and this issue brief points out, “For the first half of 2020, increased health spending due to the direct costs of diagnosing and treating COVID-19 appears to have been more than offset by a reduction in non-COVID-19 health services. It’s unknown how trends will continue through the rest of 2020.” The actuaries did not hazard a guess about rate hikes. Gains and profits made in 2020 (and/or 2021) may be rebated to consumers, if necessary, based on the 3-year formula, instead of lowering 2021 health insurance rates. The report suggests that conservative insurance companies will play it safe and increase premiums as they deem prudent for 2021. Nine page Issue Brief: Drivers of 2021 Health Insurance Premium Changes: The Effects of COVID-19 was published June 2020 at actuary.org.
The Burden of Medical Debt: Results from the Kaiser Family Foundation (KFF)/New York Times Medical Bills Survey. Data from Sept. 2015 show that about 1/4 of adults ages 18-64 had difficulty paying household medical bills in the prior 12 months. By insurance status, more than half of the uninsured had medical bill problems, vs 20% of those who were insured. Of those who were insured, 3/4 said the amounts for deductibles, copays and coinsurance were more than they could afford. Published January 2016.
CEO PayWatch database web site by the AFL-CIO permits searches to find CEO compensation in publicly traded companies. Can search by industry sector. Select View CEO Pay Data, then Health Care. Transparency of CEO pay. Many pharmaceutical company CEOs received over $20 million in annual compensation. Easy to use.
If you need help negotiating your medical bills, Medical Cost Advocate, a commercial company, will help get the price down. They take 35% of the savings. In addition, they have a prospective negotiation service that may get you a lower price before you have the service.