AHIP Statement on Age Rating

Washington, D.C. – America’s Health Insurance Plans (AHIP) President and CEO Karen Ignagni released the following statement in response to new rules released today by the U.S. Department of Health and Human Services (HHS) finalizing the age rating restrictions included in the health care reform law:

“Coverage needs to be affordable for individuals and families in order to achieve broad participation in the health care system.  The new restrictions on age rating will result in an overnight increase in health care costs for people in their 20s, 30s, and early 40s.  This increases the likelihood that younger, healthier people forgo purchasing insurance until they are sick or injured.  When this happens, costs go up for everyone, young and old.”

“The new restrictions on age rating take effect at the same time as the reform law’s minimum essential health benefits requirement and the new $100 billion health insurance tax that will further add to the cost of coverage.”

In comments previously submitted to HHS, AHIP had urged regulators to delay implementation of the age rating restrictions to avoid significant cost increases for younger people at a time when the broader reforms are taking effect.  These concerns were echoed by the National Association of Insurance Commissioners (NAIC) in their comments: “With a transition to the required 3:1 age ratio, younger, healthier individuals will experience more gradual rate increases rather than large one-time rate shocks and will be less likely to drop coverage and further destabilize the market.”

To help shine a spotlight on the impact the new age rating restrictions will have on premiums – for young and old – AHIP developed the following infographic:

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