Higher Premium Rates and Less Employer Coverage under Health Reform

Let’s take a look at the technical name of the health   reform law – the Patient Protection and Affordable Care Act. The law,   which seeks to expand affordable health coverage to all Americans, isn’t   exactly going as planned. While we have been saying this from the beginning,   it seems that everyone else is just getting the memo. Several recent studies   have indicated that health insurance premiums will, in fact, likely rise   under health reform, which will unfortunately result in some employers   dropping coverage for their employees. HHS Secretary Kathleen Sebelius even   admitted this last week. In a statement, she noted that costs will likely in   the individual market as a result of health reform.On Thursday, the Robert Wood Johnson Foundation released a study showing that employer-sponsored coverage   has dropped dramatically over the last decade. In 2000, about 70% of   employers provided coverage for their employees; by 2010, that percentage   dropped to 60%.

This accounts for a change of 12 million people losing health insurance   coverage. In the private sector, employers offering coverage fell to about   52% in 2011 from 59% in 2000. While unemployment rates also rose over the   course of this study and account for at least part of the declined rate, the   price of insurance coverage is still largely at fault. While we see this   issue everyday, the study also sheds light on the fact that the average   annual premium for individuals with work-based coverage doubled in the last   decade, from about $2,500 to about $5,000. Unsurprisingly, family premiums   also skyrocketed from about $6,400 to $14,500. While these rates vary by   state, no state saw an increase in employer-sponsored coverage over the last   decade. Michigan, Indiana and South Carolina, for example, saw the steepest   declines in employer-backed coverage, at about 15 percentage points each.

PPACA, however, is supposed to cover 27 million more Americans over the next   decade. That, taken with the 12 million who lost coverage in the last decade,   adds up to 15 million more Americans covered as a result of the law. Health   reform, however, has experienced several bumps in the road since the   Administration started rolling out regulations and drawing blueprints for the   exchanges. These bumps have already resulted in higher costs and delayed   implementation deadlines that ultimately exacerbate the healthcare issues in   this country.

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