CHICAGO, IL--(Marketwire - Apr 26, 2012) - There's nothing like receiving a health insurance rate increase in the mail to celebrate a birthday. A comprehensive study by GoHealthInsurance reveals that monthly premiums grow exponentially with age and highlights how the Affordable Care Act (ACA) will change this by 2014.
"We knew age affected premiums, but we were interested to see exactly how much on a state and nationwide level," said Mark Colwell, Consumer Marketing Manager at GoHealthInsurance. "Before health reform kicks into full effect 2014, pending the Supreme Court decision of course, every state has their own laws that govern how insurance companies set price by age. What we wanted to do with this study is offer consumers a look at how health insurance rates differ today and what to expect after 2014."
GoHealth took an in-depth look at age rating -- the practice of varying health insurance premiums based on age -- in all 50 states for 20, 30, 40, 50 and 60 year old males.
The study found that:
- Between ages 20 and 60, health insurance premiums for plans with similar benefits for men increase 288.3 percent on average across the nation, and in certain states, as much as 421.9 percent.
- A 60 year old male will pay more than $4,000 a year on average in the individual health insurance market, while a 20 year old male will pay around $1,050 on average.
- A handful of states have laws that limit age rating, and only seven states are now compliant with benchmarks set forth in the ACA which takes effect in 2014.
- Required changes by health care reform will increase premiums for young adults similar to Vermont.
The Affordable Care Act will limit age rating to a 3:1 ratio which means that health insurance companies will not be able to charge older adults more than 3 times the cost of a plan for a young adult. Since only 7 states are currently compliant with this law, health insurance companies in 43 states will change the way health insurance premiums are calculated by 2014.
Starting in 2014, young adults will be charged much more than they are currently on the individual market to comply with the age rating requirements. This does not take into account other Affordable Care Act provisions that must be made to health insurance premium calculations by 2014.
A comprehensive report on the study's findings can be downloaded on a PDF file at http://www.gohealthinsurance.com/pdf/GoHealthInsurance-Age-Rating-Study.pdf.
GoHealthInsurance.com is the most complete health insurance comparison resource online and has helped more than 2 million Americans obtain coverage. Consumers use the GoHealthInsurance.com platform to research, compare, and purchase coverage from the nation's top insurance companies using online technology, by phone, and through a nationwide network of trusted advisors. For Medicare options including Medicare Supplement plans, seniors can learn more at GoMedicare.com.
Insurance Agents can utilize GoHealth's quoting technology and suite of tools by joining the GoHealth VMO. GoHealth also offers technology and customer solution strategies for insurance carriers across the country. To learn more visit http://platform.gohealth.com.