Will Health Insurance Ever Get Cheaper?

Ask any small business owner whether the new national health law has made a dent in employer insurance bills, and the answer will likely be “No.” It’s the correct answer. In fact, insurance premiums nationally have gone up more than 16 percent since the law was enacted a little more than a year ago. In some parts of the country, increases have been as much as 30 percent.

This year, states will start cracking down on double-digit rate hikes with the hope of containing premiums by 2014, when nearly everyone will be required to purchase insurance.  But some experts question whether the new push will work.

The Affordable Care Act actually gives the federal government little power to guarantee that health insurance is affordable. Instead, the job is left up to states. But for the most part, they aren’t doing it. Almost half of them lack legal authority to reject an insurance company’s rates, and many that have the authority fail to use it.

In at least 28 states, no prior approval is required for insurance companies to raise rates on small businesses, according to data from the National Association of Insurance Commissioners. When it comes to individual policies, 21 states allow the rate hikes to take effect without approval. 

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