Who Will Have Health Insurance in the Future? An Updated Projection

The Article in Brief

Who Will Have Health Insurance in the Future? An Updated Projection

Richard A. Young , and colleagues

Background Previous estimates found that the cost of a family health insurance premium would equal the median household income by the year 2025. The current study updates this estimate based on the 2010 Patient Protection and Affordable Care Act that is reforming health care payment in the United States.

What This Study Found The cost of an average family insurance premium is estimated to surpass household income by the year 2033. Analyzing data from the Medical Expenditure Panel Survey and the US Census Bureau, researchers developed an updated model of insurance premium cost and household income projections. If health insurance premiums and national wages continue to grow at recent rates, and if the US health system makes no major structural changes, the average cost of a family health insurance premium will equal 50 percent of the household income by the year 2021 and surpass it by 2033. If out-of-pocket costs are added to premium costs, the 50 percent threshold is crossed by 2018 and exceeds household income by 2030.

Implications

• Although the change in the projection might be perceived as progress, in part owing to a recent slowdown in the rate of increases in health insurance premiums, employee contributions to insurance premiums and out-of-pocket expenses have grown faster than overall premium costs, suggesting that insurers are shifting costs to patients in other ways. The authors assert the slowdown in the rate of premium increases has been offset by higher deductibles and co-payments and fewer covered services.
• Continuing to make incremental changes in US health policy will likely not bend the cost curve, which has eluded policy makers for the past 50 years. Unless major changes are made to the US health care system, private insurance will become increasingly unaffordable for low to middle-income Americans.