This is really hard for me to believe. In fact, I had to read it a couple of times to make sure the numbers said what I thought they said.
According to a New York Post analysis of new data from the state Insurance Department, it now costs New Yorkers more to buy health insurance than it does to rent a two-bedroom apartment.
The newspaper found that the average monthly premium for family health coverage is $4,354, up 13% from last year. That’s more than the $3,947 monthly rent for a place in a no-doorman building downtown.
The report said that the jaw-dropping price follows years of double-digit rate increases as tens of thousands of healthy New Yorkers have opted to drop coverage, leaving insurers with a sicker, costlier client pool – the so called “death spiral.”
Experts, the Post says, expect rates to rise again this year when companies pass along more than $853 million in insurance-related taxes included in the state budget.
According to the Post, of the eight companies still writing health policies in the Big Apple — down from 13 in 2004 — all but two have raised their rates in the past 12 months, the Post analysis found.
The article said the insurance industry blames the rate hikes on the generous coverage mandated by state law and a co-pay structure last changed in the mid-1990s.
This is a very graphic example of the results of over regulating an industry and not encouraging market forces to drive change and innovation, and is another clear argument for consumer-driven health plans.
These types of health plans provide coverage for serious illnesses, while allowing policy holders to pay for routine expenses using tax-preferred savings accounts. A family could pay for a lot of routine medical care with $4,300 a month and still have money left over to buy a health plan to cover the unexpected expenses.