Actuaries Say Health Insurance Rates Remain Reasonable
by: Jessica Bosari
April 23rd, 2014
Those looking to predict health insurance rates for 2015 will find that it depends on who they ask. According to actuaries, the statisticians who advise insurance companies on how much to charge, rates should remain reasonable. Yet, one health insurer and many pundits are predicting double-digit increases.
Expect Increases of 6 to 8.5 Percent
According to a report from USAToday, the Society of Actuaries is not concerned about high health insurance increases. Society of Actuaries fellow Dave Axene told reporter Kelly Kennedy, “The double-rate increases we’ve been hearing are probably exaggerated. From his point of view, an increase in the range of 6 to 8.5 percent is a more realistic prediction.”
The USAToday report cites several reasons for the “bending of the curve” in health insurance costs, referring to rates that continue to increase, but at a slower rate than before the Affordable Care Act (ACA) was enacted.
People seem to be taking their medications more diligently. New drugs are becoming available to manage chronic conditions and many others have lost their patents, making them more affordable. Emergency room visits are down, as are prescriptions for pain medications.
Related: Soaring ACA Enrollment Numbers Might Help or Hurt Health Insurance Rates
High Health Insurance Rate Predictions
Lucia Graves of National Journal points to several indicators that agree with Axene, contradicting reports of high increases. It’s also important to point out that most sources arguing that rates will drastically increase are citing health insurer Wellpoint’s Ken Goulet, who was speaking to investors when he made the prediction. His statements reflect market uncertainty more than actual costs, according to Reuters’ David Morgan and Caroline Humer.
The overall consensus is that we just don’t know where rates will go. United Health Care told Forbes that it won’t be committing to 2015 rates until September, and it seems like other insurance companies will follow the same course.
Photo credit: Senate Democrats