Average Short-Term Health Premium Creeps Lower

The fight for the individual health market continues

(Image: Allison Bell/TA) (Image: Allison Bell/TA)

Typical U.S. residents who are paying for health insurance out of pocket may be willing to pay about $100 per month, and only about $100 per month, for coverage out of pocket.

Analysts at eHealth Inc., the web broker that owns eHealthInsurance.com, have published data supporting that possibility in a new look at what eHealthInsurance.com paid for short-term health insurance from February through October.

(Related: Web Broker Reports Strong Individual Health Activity)

The Affordable Care Act requires issuers of true individual major medical insurance to follow strict benefits, pricing and underwriting rules, and to sell coverage only during a short open enrollment period.

Issuers of short-term health insurance can offer similar benefits, especially for basic sick care and injury care, but, in most states, they operate without the kinds of rules that apply to major medical coverage issuers. They can offer whatever benefits and prices, and apply whatever medical underwriting requirements, the market will bear.

The eHealth analysts found that, in the real, free short-term health insurance world, the actual price its customers pay for short-term health insurance out of pocket has fallen to $109 per month this year, from $110 per month in 2016.

The average price for family coverage fell to $264 per month, from $276 per month.

The eHealth analysts did not talk about how the value of the short-term health plans' benefits changed over time, or whether the short-term health issuers' underwriting requirements seemed to get tougher or easier.

The eHealth short-term health price finding may reflect the idea that consumers think "about a $100 per month" is a reasonable price for many different types of health coverage.

In the long-term care insurance market, for example, issuers and agents have long talked about the idea of trying to develop products designed to appeal to consumers who want to spend about $100 per month on coverage.

Meanwhile, in related news, another web broker, HealthSherpa.com, has reported on what's happening to prices in the individual major medical market.

The individual major medical market open enrollment period for 2018 started Nov. 1 and is sent to end Dec. 15.

In that market, total monthly premiums have increased 28%, but subsidies have increased 36%. The average net premium consumers are actually on track to pay in 2018 is down 13%, HealthSherpa says.

HealthSherpa did not give plan price data.

Actuaries at Wakely have estimated that in Colorado, for example, consumers who qualify for subsidies and actively shop for coverage may pay an average of $76 per month, and that those who simply renew their current coverage might pay an average of $123 per month.

High-income users who qualify for no subsidies may pay an average of $428 per month if they shop for coverage, and $479 per month if they simply keep the same coverage, according to Wakely.

— Read Web Broker Sees HealthCare.gov Downtime as Sales Opportunity on ThinkAdvisor.


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