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Individual Health Premium Revenues Rose 15% Nationally in 2009 Says NAIC Report

Individual health insurance premium revenues rose 15 percent in 2009,  according to a report from the National Association of Insurance Commissioners (NAIC). The report was based on company annual financial filings to the NAIC. It was not a complete depiction of the privately insured market, the organization cautioned, because not all health insurers must file with such state departments.

Related Reading:

CT Health Insurers Seeking Immediate Increases of 20%+!  September 16, 2010

Medical Insurance inflation: Factoring Into a Settlement Solution  August 26, 2010

Read more: http://www.insurancejournal.com/news/national/2010/09/17/113311.htm#ixzz104L99Fdu

Connecticut Health Insurers Seeking Immediate Increases in Premiums of 20% Plus

by John Darer® CLU ChFC CSSC RSP

Connecticut Health Insurers have thrown gas on the fire by seeking immediate 20% increases in rates, according to a September 15, 2010 report in the Hartford Courant. Rising medical costs and federal health report laws were cited reasons.

Whether the State of Connecticut Insurance Department approves the increases in full, or in part. the increases could play a part in the value of  personal injury cases where there is liability and includes a significant medical component. 

There are a variety of ways to deal with future medicals in personal injury cases. Regardless of the approach used it is critical to address the issue to mitigate erosion of settlement proceeds.

When considering the funding of a medical policy as part of the settlement solution,  calculating the cost of such solution one must recognize the cost of medical insurance increases. Based on what we know now, a 3% fixed increase would not be adequate. Moreover, be aware that these are just increases in premiums and do not reflect the deductibles, co-pays and co-insurance that may apply. Those must be factored in as well. An additional wrinkle is that most structured annuity issuers will cap contractually based increases to 5% or 6%.  One must account for the gap and determine how it is to be funded.

The Connecticut story follows my recent post concerning historical premium increase in New York City for the past decade.

Medical Insurance Inflation: Factoring Into a Settlement Solution  August 29, 2010

 

Medical Insurance Inflation: Factoring Into a Settlement Solution

by John Darer CLU ChFC MSSC RSP CLTC

The AVERAGE year over year rate of increase in health insurance premiums for New York City residents across 8 leading insurers was 11.23% based on data assembled by the New York Public Interest Research Group (NYPIRG) and published in the August 29, 2010 Daily News. According to the report "Self-Insured Feeling Pinch" there has been MORE THAN A DECADE of double digit increases.

The increasing federal deficits may make it increasingly difficult to shift tortfeasor responsibility to government based initiatives like Medicaid and Medicar.

Buying medical insurance is a solution. In some states like New York and New Jersey there is guaranteed issue community rated medical insurance. These have been around for close to 20 years, originally as a private insurance solution to the Clinton era threat of Universal Health Care. As an alternative to the restrictions found in government funded benefits private health plans in such states may offer more flexibility in physician selection

Some states offer catastrophic health insurance pools. Then of course we now have "Obamacare"

When calculating the cost of such solution one must be cognizant of the cost of medical insurance increases. Moreover, be aware that these are just increases in premiums and do not reflect the deductibles, co-pays and co-insurance that may apply. Those must be factored in as well. An additional wrinkle is that most structured annuity issuers will cap contractually based increases to 5% or 6%.  One must account for the gap and determine how it is to be funded.