Since the forth child under 18 is free, family rates have doubled for many. Just today I saw a family plan go from $1,200 per month to $2,500 per month for the same plan as last year. The younger rates went up 10% and this age band for families more than doubled. OUCH!
It seems to me that the age banding is really shoving the total premium for many groups higher. So, younger employees pay far less than their older co-workers but the total group premium year over year is also showing a dramatic increase as well.
Part of this is simple to clearly communicate ... simply said "free benefits" are NOT free ... but rather more like the old Prego Spaghetti Sauce commercial ... "it's in there!" So it is. The preventive care coverages raise the cost of the premium because the actuaries will assume 100% use and it will be far less than 75%. The "catchup" will come later, in the MLR (Medical Loss Ratio) calculations. But, that is another issue with this first round of premiums ... The carriers would be foolish to leave any money on the table ... so ... put enough in the premium to make sure that all the bases are covered and they get to retain the highest possible amount of premium allowed.
I want to be clear ... there are no bad guys here. Anyone that labels either the government, regulators, IRS, care providers, carriers, brokers or insureds as bad or less than ethical is just trying to place blame. There is enough of that to go around! At almost every level, there is some "hedge" placed to protect the interests of the party that can have some controls. The carriers may charge more than they really need to but it is in their interests to "hedge" on the side of being financially sound. Providers will continue to have a spread between what the carriers pay and the "full price" for services as a huge multiple ... a practice I have never understood. Insureds will continue to "fail to shop" and fertilize the "hedges" of the pharmacies, providers and carriers because they are uninformed. Let me give a positive example.
Most of us know that the "real" price for care, procedures, surgeries and such is somewhere between the amount paid by the insurance company and the full price that is listed on the EOB (Explanation of Benefits). Just the other day, I was speaking to a fellow business owner who also has a really HDHP (High Deductible Health Plan). So high that toward the end of the year, if he is no where near his deductible, he "negotiates" with the provider for a "cash price" for services INSTEAD of turning it in on his insurance ... He has saved thousands. I have done this too. That reminds me of another commercial. Life Cereal ... Mikey.
"Hey Mikey, give it a try! Hey ... he likes it ... Mikey likes it!" Saving money is always enjoyable. Over time, this could FIX the system by injecting real demand to real supply ... Economics 101.