A column in the Wall Street Journal looks at the effect the health reform law will have on premiums.
The column notes that come January 1, 2014, the health reform law limits age rating bands to 3:1 (42 states currently have a 5:1 ratio or higher).
“These new, 3-to-1 rating bands—as these ratios are called—will shift costs from older people to younger people, most experts agree. America’s Health Insurance Plans, a trade group representing insurers, did a hypothetical illustration showing how this will affect a 24-year-old and a 60-year-old with the same individual policy in the same area: starting on Jan. 1, the 24-year-old will pay 50% more for coverage than he or she would have in 2013, and the 60-year-old will pay 10% less.”
The column also states a potential effect of these rising prices: “Of course, if too many young people decide not to pay these increases and drop their coverage, then the overall pool becomes older and presumably sicker, and rates will rise across the board.”
For more information on factors driving premiums, visit http://www.ahip.org/affordability.