Massachusetts has near universal health coverage, why are rates still increasing?


According to this article in the Business Insider,

Massachusetts, which has the lowest uninsured rate of any state, also has several counties with near universal health insurance coverage rates, according to the U.S. Census Bureau.

Wasn’t universal health insurance suppose to lower premiums?   Unlike inanimate objects that costs less as you buy more like the infamous widgets in college, health insurance subscribers come with claims.

If you insurance more people, but they have alot of claims then your rates will go up.   In other words the number or percentage of people insured has nothing to do with the cost of health insurance.   Claims is what drives premiums more then anything else.

If you lower or contain claims then you will lower or control premiums.    There are two ways to lower claim costs.

  1. Avoid claims completely through wellness plans that prevent claims or catch them in the early stages.
  2. When claims can not be averted lower the actual costs of claims through insurance products that cost the employee more at higher cost facilities.

Admittedly this is an over-simplification but claim costs drive premiums not universal coverage.  It really is that simple.


Health Insurance rates

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