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What Really Drives Up Health Insurance Premiums

July 19, 2013 in Health Insurance

Every year it seems that we are paying more and more for health insurance. According to an informative infographic Carrington College, the health care costs in the United States have grown 2.4 percent faster than the GDP, meaning that as of 2010, people were paying more than 8,000 dollars per person, and that money represented about 18 percent of the United States’ economy.

There are several factors, which have contributed to the rising price of health insurance. For example, one benefit which has had unexpected costs is the medical technology that is now being used. The technology that is used to diagnose and treat illnesses accounts for at least 50 percent of the growth of medical expenditures since the 1960s, putting an increased burden on the people paying for their health insurance.

Another factor that affects the health insurance rate for most people is the failure to use a primary care physician. With more people only going to see doctors for emergencies, there is actually less money being spent on primary care doctors, a practice which has been shown to lower costs. In comparison with other industrialized countries, the United States spends three to six times as much money on specialist doctors.

There are many factors that tie into the rise of health insurance costs, including things like medical billing fraud and an aging population, so check out this informative infographic to learn more about what really drives up those premiums.

(Click to enlarge)Why is Health Insurance So Expensive

 

Managing High Health Care Costs on Your Family’s Budget

July 22, 2012 in health care costs, Health Insurance, Hospital Bills, Insurance Bills, Medical Care, Medical Debt

Recent news on the costs of health care, in the U.S. and around the world, is focusing on what experts call “double digit levels” of annual increases. This is bad news for us, and troubling for the country as a whole. What it translates to is annual increases over 10%, where health care costs could conceivably double in a decade. Since this kind of price spike has been going on for a while already, many American families already consider major medical care to be priced above their ability to afford it.

Who Pays the Bill? 

Part of the particular desperation that has surrounded the American medical industry in the past few years has to do with who usually pays the bill.

In the past, employer group plans provided coverage for the majority of Americans. A few decades ago, this model was built on stable, long-term contracts between workers and companies, where those who stayed loyal to a business could expect to keep a job for life. Also, employers paid a major part of all premium costs.

In the present, however, we’ve felt the rise of health care prices. First, employers started to lower the premium amounts they were willing to pay. As jobs went overseas, employers laid off workers. Then, as the economy grew weaker, more lost jobs. An unemployment rate of over 10% means much more than lost wages: it means that many thousands of American families are suddenly left without coverage.

Meanwhile, the group plans that are left often do not pay the majority of premiums and often include high deductibles, which are also extremely expensive for the average family. In fact, some employers hardly pay anything toward premiums at all, while others provide “mini-medical” plans or other virtually useless coverage, or move full-time positions to part-time and thus avoid offering plans.

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