Signs Emerge of the Growing Cost of Health Insurance

Health insurance may actually become more expensive

There is a new trend emerging in the U.S. health insurance sector that may prove that health insurance rates are expected to increase significantly in the near future. Many health insurance companies in the individual market have stopped offering guarantees for a policyholder’s yearly premiums. Insurers throughout the U.S. have been warning consumers that health insurance rates may be going up as a direct result of the Affordable Care Act. This new trend may be the first glimpse of that warning becoming a reality.

Premium guarantees will be no more

Traditionally, health insurance companies in the individual market have provided guarantees for premiums for an entire year. In the past, it was common for some consumers to receive these guarantees if they opted to pay for the entirety of their health insurance premium in one sitting, rather than in monthly installments. For these people, the rates for their coverage averaged lower than policyholders who paid their premiums monthly. This practice is now becoming extinct.

Aetna moves to abolish rate guarantees

Earlier in January, several health insurance companies began information brokers and agents that they will no longer be offering guarantees for premiums. These companies, of which Aetna is included, will be adopting a more common month-to-month structure for their premiums. This allows insurers to raise rates on coverage as they see necessary, rather than having to be locked into a particular rate bracket with a policyholder for an entire year.

Aetna policies enacted after January 15, 2013 will receive no premium guarantees

In Aetna’s case, the changes it is making to its policy pricing affect policies that were enacted after January 15, 2013. Existing policyholders that have already received a premium guarantee from the insurer will not be affected by the change until their policy is scheduled to be renewed. Aetna has removed any mention of rate guarantees from its marketing materials and online resources and will not be offering this service again in the foreseeable future.

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