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Why Is My Health Insurance So Expensive?

The cost of personal health insurance is a major concern for people in Central Florida. Health insurance costs seem to go up every year, yet it is often hard to know exactly what you are getting for the money.

Likewise, the cost of prescription drugs continues to rise. Inflation has led to some of the sharpest increases in prescription drug costs. Unless your health insurance offers robust prescription drug coverage, these costs will continue to eat into your household budget.

A number of factors contribute to higher health insurance expenses:

1. In General, Health Insurance Companies Can Raise Rates as Much as They Want

Although millions of people are covered by Affordable Care Act insurance, the great majority of health insurance in the U.S. is provided through employers. Large employers have deeper pockets, and health insurance companies are motivated to get them to use as much of their buying power as possible.

At the same time, insurers face very few limits on how much they can raise their rates. While increases take into account factors like inflation and rising drug costs, these are only the “floor” for the increases, not the ceiling. Health insurance companies thus raise their rates each year to grow their profits.

2. Demographic Changes Are Driving Higher Costs in Healthcare

In 2019, 54.1 million Americans were aged 65 or older. While the median age in the U.S. is still around 38 years old, the growing number of elders makes for a significant shift in care and how it is provided.

Health insurance companies know they are more likely to receive claims from older people than younger ones. They can offset this to some extent by attracting younger people and larger organizations to enter the insurance rolls, but this doesn’t offset the entire cost of complex claims.

To prevent unfair pricing practices that target elders specifically, general rates increases can be spread out over the entire enrolled population. As the overall cost of care and costs of the average claim both go up, so do health insurance premiums as a whole.

3. Recent Events Have Accelerated Negative Trends in Care Costs

As COVID-19 becomes an endemic disease, it is still important to recognize the significant impact it has had on the healthcare landscape. Although governments absorbed much of the cost in the initial wave of COVID-19 healthcare spending, this still amounted to billions of dollars in unexpected expenses.

At the time of this writing, there are fewer severe cases of COVID-19 than before. However, it is really not possible to know how many people will be dealing with the effects of post-COVID syndrome, also known as “long COVID.” Insurers are preparing for the possibility that these costs will be significant.

A Local Health Insurance Broker Can Help You Control Health Insurance Costs in Central Florida

Unfortunately, most of the factors driving expensive health insurance are beyond the control of any individual. If you have insurance through an employer, you may be able to reduce your costs if you switch to a less expensive plan – but that can entail significant trade-offs in your coverage.

No matter whether you have ACA insurance, private employer insurance, or something else, you could find that it simply doesn’t meet your needs the way you would like. In situations like these, a local health insurance broker is the best ally you can have.

A local health insurance broker is an independent insurance professional who develops insight into all of your local health insurance options. Your health insurance broker is familiar with major health insurance agencies as well as other providers you might not be able to find out about on your own.

Working With a Broker Means Having More Options – That Can Save Your Budget

“Big name” agencies are really only the beginning when it comes to insurance. Most of those companies are optimized to work with large employers, not individuals, and have little to offer the average Central Florida family. On the other hand, a local health insurance broker can expand your options.

Your broker learns about professional associations, nonprofits, and other organizations all throughout your area that also provide health insurance. That allows you to get the complete picture, so you can review all the possibilities. It’s much easier to spot those that fit within your budget, too.

One thing to remember is that your local health insurance broker is completely independent. They don’t uphold any sales quotas or other restrictive agreements with health insurance providers. That means you get real, impartial advice based on your needs.

Contact Choice Health Insurance Brokers to learn more today.