Major Reasons behind Why Your Health Insurance Premiums Are Going Up Again

While health insurers are really busy setting their premium amounts for the year 2017, economists and industry experts claim that premium will actually increase next year, however the size of the increases is uncertain and unknown.

A recent report from the American Academy of Actuaries claims the trends that will affect the health insurance premiums next year. “There are both upward and downward pressures on premiums for the year 2017, but for the person and minor group markets as a whole, the factors driving premium rising up dominate,” senior academy health fellow Cori Uccello stated in a statement.

Here are some of the greatest trends affecting your premium prices next year:

• The price of care is going up. While overall health care prices are not increasing as rapidly as they have historically, they are yet increasing, with prescription drug prices rising specifically fast. That trend will likely sustain, as more high-price specialty drugs come to market.


• A federal program offering extra cash to marketplace insurers will finish. Since the year 2014, the federal government has compensated health insurers who enroll higher-cost clients in their policies through a reinsurance program, which has steadily reduced the rate of payments per year. In the year 2017, those payments will end completely, which the Academy of Actuary projects could force costs up 4% to 7%.


• Insurers have a great understanding of the risk pool. Insurers set and place their premiums to depict their experience with the real threat of those enrolled in Obamacare. The Academy of Actuaries doesn’t project how this will affect rates next year, but notes that in initial years, several insurers set premiums too low to cover their real prices and will learn from that experience and process.