Agency News and Notes

Premiums rise 18 percent for nonemployer health insurance

People who buy their own health insurance saw their average annual premiums rise 18 percent between 2002 and 2005, a modest increase compared with the 34 percent jump in average premiums for people insured through their employers, according to data taken from the Medical Expenditure Panel Survey (MEPS). The annual cost of these nonemployer policies was paid entirely out of pocket. The average annual premium for a one-person policy was $2,835 in 2005, up from $2,531 in 2002. Annual premiums for family policies were $5,568 in 2005, up from $4,442 in 2002.

The analysis also found that:

• Among those under age 65, about 12 million Americans, or less than 5 percent, were covered by policies purchased in the nonemployer market in 2005 compared with 174 million, or 67 percent, covered by employer-based health insurance.
• For people with company-sponsored insurance, average annual premiums paid out-of-pocket rose from $1,231 to $1,655 between 2002 and 2005.
• About 70 percent of nonemployer policies were single coverage and 30 percent were for family coverage.
• Premiums for nonemployer policies differ by age of policyholders. One-person premiums were $1,580 for policyholders under age 40 and $4,288 for policyholders aged 55-64.

For more information, go to Premiums in the Individual Health Insurance Market for Policyholders under Age 65: 2002 and 2005, MEPS Statistical Brief 202, at http://www.meps.ahrq.gov/mepsweb/data_stats/publications.jsp.

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