Will Your Health Premiums Go Up Next Year?

medical premiums 2 The short answer is that we don’t really know.

One recent study says insurance premiums for many people could rise by 40% next year under the Patient Protection and Affordable Care Act, but also claims that others could see premium decreases.

The new study by Milliman consulting firm, on behalf of Center Forward, a bipartisan organization, focused on premiums for individual and group medical insurance plans in Florida, Arizona, Illinois, New Jersey, Ohio and Wisconsin.

Milliman estimated that “individual premiums, on average, will increase 25 percent to 40 percent due to PPACA, while small market group premiums could increase by 6 percent to 12 percent.”

But here’s some very important caveats to the study’s findings:

  • We know things will change next year as the provisions of the Patient Protection and Affordable Care Act (PPACA-or Obamacare) start kicking in. But so far, we can only speculate as to how the changes will affect us. The state health exchanges and other key provisions of the PPACA are not yet operational, so we don’t yet have estimated premiums for policies offered as of January 1.
  • The Milliman study says people in some states may actually see premium decreases, as the pool of insured people widens and “high” and “low” premiums are averaged out. The young and healthy who currently have bare-bones medical policies should expect better coverage next year, but higher premiums. Older and less healthy individuals, now paying high premiums, may see only small premium increases.
  • Some of those affected by premium increases may be eligible for subsidies being offered by the federal government, which could help them offset the cost.

The bottom line? We are all anxious to know how our medical coverage and premiums may change next year … but unfortunately, it’s still too early to tell. We expect to have more details as we approach the October 1 roll-out of the new health exchanges.

About Mari Adam

Mari Adam, Certified Financial Planner™ and President of Adam Financial Associates Inc, has been helping individuals and families chart their financial futures for over twenty-five years. Have a question about your financial situation? Ask Mari!

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