INTERVIEW: Local insurance agent explains higher 2019 rates

Listen to KID NewsRadio’s full interview with local insurance agent, David Parker

IDAHO FALLS, Idaho — New reports say insurance rates are expected to go up again in 2019.

They’re looking a little closer to trend then they were last year.,” David Parker, a local insurance agent, told KID NewsRadio. “Last year we took some pretty significant increases overall, the average state wide rate increase this next year is going to be eight percent.”

While the rate increase isn’t as drastic as in previous years, Parker said the continued rise in premiums is largely due to an overall trend of inflation in medical expenses and the way insurance companies cover people for catastrophic events more effectively than less urgent or less aggressive health issues.

“You’ve got somewhere between a five and seven percent chance you’re going to hit your out-of-pocket maximum,” Parker said. “So, what we’re doing is we’re subscribing to a pool that protects us in just a huge catastrophic grid”

Parker also said the cost of pharmaceuticals are pushing costs up. Expensive pharmaceutical treatments can mean people hit their out-of-pocket maximum fairly quickly, putting the burden of cost back on insurance companies and driving prices up for everyone in the insurance pool.

I was sitting with a couple yesterday that they’re paying…for a specific…medicine, I think they’re around $6,000 a month,” Parker said. “That hits your out-of-pocket max really fast and then the insurance company, they pay the $6,000 a month and that ends up being that if you’re talking collecting regular premiums to pay for that, that puts a lot of upward pressure on that.”

This trend is pushing more and more people to opt for a health savings account over a typical insurance plan. Using the health savings plan does have it’s benefits, Parker said, and lawmakers are looking at expanding the usability of those plans. Under one proposal, customers would the ability to roll over flexible spending dollars and increase contribution amounts. But, these proposed benefits come at a cost, sacrificing an office co-pay, for example.

But, health savings accounts aren’t the only solution lawmakers are looking at to both provide better coverage and provide it for more people. Parker said as people on both sides of the political aisle argue over expanding Medicaid and Medicare, or repealing Obamacare, there’s plenty of questions yet to be answered when it comes to funding.

I don’t see a good case for them to repeal,” Parker said. “So many people have got so much out of it that to repeal it now would significantly alter people’s lives, and I don’t think they’re willing to take that political liability….between Medicare and Medicaid, government pays for a lot of health services and anytime the government pays for stuff, it seems to push costs up and so, you’re causing the problem, you’ve kind of got be part of the solution and…I hate to feel like we’re railroaded, but the railroad tracks we’re on, we’re kind of heading down that track and going back…it would be difficult.”