Ever wonder what goes into a health insurance quote, and how prices are affected?  The article “What Really Makes Health Insurance Premiums Go Up” by Julie Rovner on NPR.org gives some insight.

The article points out that rising health insurance quotes and premiums, specifically in the short term, is a continuing worry across the nation.  Whether you are in the market for HMO or PPO health insurance, rates is a primary factor.  Democratic lawmakers worry that increases in rates will lead Americans to believe the new law isn’t doing what it is supposed to, but that isn’t necessarily the case.

Many factors go into the cost of health insurance.  Medical prices are just one of many of those factors.  It also depends what type of people sign up for certain policies and how many services people will use.  Even if medical costs remain flat, if more policyholders use more medical care then rates will have to rise to meet that demand.  Those setting premiums also have to consider the costs of new types of drugs or treatments coming online, and various changes in taxes and regulations.  This is how medical inflation of only 3-4% can turn into an 8-9% increase in health insurance premiums.