Age Rating

Age Rating TIME FOR AFFORDABILITY. Older patients typically utilize more, and higher cost health care services than younger patients. One way states can ensure that coverage remains affordable for everyone is to use age rating bands that spread premium costs over a range of age groups. Currently, in a state with a 5:1 age band, the ratio limits the amount an older individual will pay to no more than five times what a younger individual pays in premium dollars. Right now, 42 states have age rating bands that are 5:1 or more. On January 1, 2014, the health care law limits a state's age rating bands to 3:1. EFFECTS OF AGE RATING BAND CHANGE FROM 5:1 TO 3:1 For Example. .This 24-year-old's annual health insurance premium is currently $1,200. NOW 5:1 AGE RATING BAND This 60-year-old's annual health insurance premium is currently $6,000. On January 1, 2014, the Health Care Law Limits Age Rating Bands to 3:1 Overnight, the younger individual's premium increases to $1,800 annually. PAYS 50% MORE 2014 3:1 AGE RATING BAND The older individual pays an annual premium of $5,400. PAYS 10% LESS If the younger individual's premium becomes unaffordable, they will choose not to purchase FUTURE coverage. If young, healthy people drop health insurance coverage, premiums rise for everyone. "If.young people drop out of the insurance pool, but all of the older people stay in, you get...adverse selection [which] drives up...the average premium costs for the people remaining in the insurance pool." -Forbes *Illustrative Example y Follow AHIP on Twitter at @AHIPCoverage and @AHIPEducation in Follow America's Health Insurance Plans on Linkedin Follow the AHIP Coverage Blog at www.ahipcoverage.org Design AHP- All Rights Raservad: CAHIP 2012 AHIP Age Rating TIME FOR AFFORDABILITY. Older patients typically utilize more, and higher cost health care services than younger patients. One way states can ensure that coverage remains affordable for everyone is to use age rating bands that spread premium costs over a range of age groups. Currently, in a state with a 5:1 age band, the ratio limits the amount an older individual will pay to no more than five times what a younger individual pays in premium dollars. Right now, 42 states have age rating bands that are 5:1 or more. On January 1, 2014, the health care law limits a state's age rating bands to 3:1. EFFECTS OF AGE RATING BAND CHANGE FROM 5:1 TO 3:1 For Example. .This 24-year-old's annual health insurance premium is currently $1,200. NOW 5:1 AGE RATING BAND This 60-year-old's annual health insurance premium is currently $6,000. On January 1, 2014, the Health Care Law Limits Age Rating Bands to 3:1 Overnight, the younger individual's premium increases to $1,800 annually. PAYS 50% MORE 2014 3:1 AGE RATING BAND The older individual pays an annual premium of $5,400. PAYS 10% LESS If the younger individual's premium becomes unaffordable, they will choose not to purchase FUTURE coverage. If young, healthy people drop health insurance coverage, premiums rise for everyone. "If.young people drop out of the insurance pool, but all of the older people stay in, you get...adverse selection [which] drives up...the average premium costs for the people remaining in the insurance pool." -Forbes *Illustrative Example y Follow AHIP on Twitter at @AHIPCoverage and @AHIPEducation in Follow America's Health Insurance Plans on Linkedin Follow the AHIP Coverage Blog at www.ahipcoverage.org Design AHP- All Rights Raservad: CAHIP 2012 AHIP Age Rating TIME FOR AFFORDABILITY. Older patients typically utilize more, and higher cost health care services than younger patients. One way states can ensure that coverage remains affordable for everyone is to use age rating bands that spread premium costs over a range of age groups. Currently, in a state with a 5:1 age band, the ratio limits the amount an older individual will pay to no more than five times what a younger individual pays in premium dollars. Right now, 42 states have age rating bands that are 5:1 or more. On January 1, 2014, the health care law limits a state's age rating bands to 3:1. EFFECTS OF AGE RATING BAND CHANGE FROM 5:1 TO 3:1 For Example. .This 24-year-old's annual health insurance premium is currently $1,200. NOW 5:1 AGE RATING BAND This 60-year-old's annual health insurance premium is currently $6,000. On January 1, 2014, the Health Care Law Limits Age Rating Bands to 3:1 Overnight, the younger individual's premium increases to $1,800 annually. PAYS 50% MORE 2014 3:1 AGE RATING BAND The older individual pays an annual premium of $5,400. PAYS 10% LESS If the younger individual's premium becomes unaffordable, they will choose not to purchase FUTURE coverage. If young, healthy people drop health insurance coverage, premiums rise for everyone. "If.young people drop out of the insurance pool, but all of the older people stay in, you get...adverse selection [which] drives up...the average premium costs for the people remaining in the insurance pool." -Forbes *Illustrative Example y Follow AHIP on Twitter at @AHIPCoverage and @AHIPEducation in Follow America's Health Insurance Plans on Linkedin Follow the AHIP Coverage Blog at www.ahipcoverage.org Design AHP- All Rights Raservad: CAHIP 2012 AHIP