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Ending individual mandate would not dramatically hike insurance prices, study finds
Date:2/16/2012

e Care Act, individuals cannot be charged higher premiums because of preexisting medical conditions or current health problems. But the law does allow older people to be charged as much as three times more than younger people for health insurance.

The simulations done by RAND and other researchers suggest that most of those who would forgo health coverage if the individual mandate were eliminated would be younger. That would leave the insurance exchanges with proportionately more people purchasing insurance in the older age brackets, where premiums are higher.

Taking these age issues into consideration, RAND researchers estimate that the premiums paid by individuals using the exchanges would be 2.4 percent higher if health reform moves ahead without the individual mandate. This is a more modest impact than others have predicted.

When the individual perspective is dropped, RAND's estimate of the overall average increase is roughly in line with the studies done by other groups. The overall average premium among all people using the exchanges would be 9.3 percent higher -- an increase caused largely because a disproportionate share of people left buying policies after the mandate is repealed would be in older, more-expensive age brackets.


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Contact: Warren Robak
robak@rand.org
310-451-6913
RAND Corporation
Source:Eurekalert

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