Anthem Blue Cross has claimed that one reason behind its big proposed rate increase is the bad economy, which, the company says, is leading healthy people to give up their coverage while the sick remain in the insurance pool. That would mean there are fewer people to spread the risk, forcing those who remain to pay more for their coverage. But an analysis by Jonathan Kolstad and Neeraj Sood at Health Affairs suggests that there has been no change in the health status of people who buy insurance on their own.
The authors look at data from the US Current Population Survey from 2007 and 2009. Those surveyed are asked, among other things, to describe their own health status. Among Californians who bought insurance through the individual market, there was a small increase in the number who said their health was “good” and a small decrease in the number who reported that it was “very good.” The age and gender demographics of the people with individual coverage was unchanged.
In short, the authors say they saw “little evidence” that the recession had a significant effect on the kind of people who are buying insurance in the individual market.
Read the whole thing here.
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I don’t think that data is an accurate depiction of a person’s health. Generally, whether anyone wants to admit it or not, people obtaining individual coverage are not always “honest” with their health status. Moreover, where is the data on people losing their coverage? What is their health status.
Again, if Blue Cross of California lost 25,000 customers while it still has 700,000 remaining customers, had the customers it lost been all perfect, zero-loss customers and paid premiums that were average of the entire private market pool of the company, then losses of Blue Cross would remain largely the same while the total premiums received would be at 96.5% of what they were before. If its continuing customers were to make all that up the loss of the premiums of the lost perfect customers, along with the rise in health care inflation, it would still be far below the average 25% increase in premiums that Blue Cross wants.