By REED ABELSON
c.2010 New York Times News Service
Even as the nation was debating whether to overhaul the health insurance market, people who were buying coverage on their own were experiencing sharp increases in the cost of their policies, according to a survey released Monday.
Those surveyed said they were faced with premium increases averaging 20 percent when they last sought to renew their coverage, according to the Kaiser Family Foundation, a nonprofit health policy research group, which conducted the survey in March and early April.
While some people switched to less expensive plans that offered less generous coverage, and others negotiated lower prices than their insurers initially requested, the people surveyed still reported an average increase of 13 percent on their health insurance costs.
Just how steep the increases have been in the market for individual insurance has been an open question since earlier this year, when Anthem Blue Cross tried to raise its rates by as much as 39 percent in California. The proposed increases were met with outrage from federal and state officials, but there was little information about how widespread such increases were in other parts of the country. Anthem, which is owned by WellPoint, one of the nation's largest insurers, later withdrew its request to raise rates.
"The survey shows that the steep increases we have been reading about over the last several months are not just extreme cases," said Drew Altman, the Kaiser foundation's president and chief executive. He said the increases far outpaced those in the market for large employers buying coverage for their workers.
The findings also underscore the challenges that will continue to be faced by people in the individual market until changes under the new health care law go into effect in 2014, Altman said. About 14 million people under the age of 65 purchase their coverage in the individual market, according to Kaiser.
Health insurers say any rate increases reflect the rapid growth in the underlying cost of medical care.
"The data show premiums track the underlying cost of health care," said Robert Zirkelbach, a spokesman for America's Health Insurance Plans, an industry trade association in Washington.
But the survey also provided a glimpse of what kind of coverage individuals are purchasing on their own. While people reported paying lower premiums than they would in a typical employer-provided plan, they also reported being in plans with much higher deductibles. While individuals reported paying average annual premiums of $3,606, according to the survey, they also reported an average deductible of nearly $2,500. One in four people report being in plans with an annual deductible of $5,000 or more.
Despite some of the well-publicized disputes between health insurers and state regulators over premium increases, there is little comprehensive information about the kinds of increases in rates individuals face when they buy insurance on their own. "We don't have data on average premium increases," said Zirkelbach, the industry spokesman, who noted the difficulty of tracking such information.
The survey was based on a random sample of 1,038 people who bought health insurance for themselves or for their families on their own. The survey's margin of error was plus or minus four percentage points.