Incentives and penalties in the Senate healthcare reform bill are insufficient to bring healthy young people into the individual and small-group insurance market and would thereby drive up premiums, according to an analysis released by the Blue Cross and Blue Shield Association.
Average annual medical claims in the Senate bill's reformed individual market will be 54% higher than today by 2019, according to the analysis, conducted by Oliver Wyman, a consulting firm, for the Blues association.
Another factor that would drive up costs is that today's uninsured, once covered, will have medical claims about 20% higher than current enrollees in the individual market, according to the report. Today, people in the individual market are healthier than the uninsured because in most states, insurers can refuse coverage to people with pre-existing conditions, according to Oliver Wyman.
“Overall, we expect average premiums after reform to increase significantly,” said Jason Grau, an associate partner with Oliver Wyman, on a conference call.
Premiums for people purchasing new policies on the individual market would be $4,561 for single coverage and $9,669 for family coverage in today's dollars—representing premium increases of $1,576 and $3,341, respectively, according to the analysis.
Premiums for the youngest 30% of the population, who typically have low medical costs, would jump by 35% after enactment of the Senate's Patient Protection and Affordable Care Act, according to the analysis.
Earlier this week, federal actuaries said the overhaul bill would result in higher health insurance premiums for many but that much of the increased costs
would be defrayed by subsidies.
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