Nearly three-fourths (74 percent) of insurance brokers surveyed report observing double-digit rate increases since the Patient Protection and Affordable Care Act was enacted.
Brokers often are on the cutting edge of coverage and cost trends, which is why Benefitter surveyed more than 1,000 of them in late October. The San Francisco company helps brokers and employers identify new options in the individual health insurance market. The brokers surveyed represent companies with more than 1.2 million combined employees.
Seventy-eight percent of brokers have had clients drop group benefits in the past year. According to the survey results, “for some employers, health insurance is no longer affordable. For others, their employees can actually find more affordable options on the individual market.
“Individual coverage is often more affordable due to rich federal subsidies (premium tax credits), whose value is oftentimes far greater that employer penalties for not providing coverage.”
Among other significant findings:
- Seventeen percent of brokers expect to lose more than one-quarter of their business in the coming year.
- Nearly three-fourths of brokers are seeing average rate increases of more than 10 percent.
- One-third have observed rate hikes above 60 percent.
Rate increases have affected all sizes of businesses. The percentage of brokers who report having seen rates go up by category are:
- Micro-group (less than 10 employees), 64 percent
- Small group (10 to 50 employees), 77 percent
- Mid-sized group (50 to 250 employees), 75 percent
- Large group (more than 250 employees), 60 percent