Early indications are that HMO rates will rise 7-8% next year. Compared to this year’s 10% average increase, that’s good news. And here’s just how good that news is.
Withfamily premiums (HMO and other plan types) hovering at the $11,000 mark, and rates increasing by, say, 7% per year, we’ll have health insurance costs of $20,000 per family in ten years. Truly the miracle of compound inflation (sorry, Benjamin Graham).
The 7% increase quoted is a wildly optimistic figure, as rates have increased at least 9% each year for the last five years. And, with the number of people without insurance increasing every year, further adding to cost-shifting to insureds; tighter eligibility requirements for Medicaid; and increased employee cost-sharing the middle class (read – voters) will be increasingly demanding action – and if the next presidential election does not have health care as a top theme, it will only be because of a horrendous natural or man-made disaster. Although one could reasonablyh consider the US health care system a man-made disaster, I’m thinking more on the order of foriegn policy.
What does this mean for you?
More pain before our elected officials get their collective act together.
Insight, analysis & opinion from Joe Paduda