Health Insurance

PRIVATE HEALTH INSURANCE

Health insurance, also referred to in the insurance industry as accident and health insurance, includes coverage for medical expenses, disability and long-term care. Health insurance companies reported direct premiums written of $418.4 billion in 2011, according to SNL Financial. Life/health and property/casualty insurers also write this coverage, accounting for an additional $177.8 billion and $5.7 billion in direct premiums, respectively, in 2011. This brought total private health insurance premiums to $601.9 billion in 2011. The number of people without health insurance coverage declined from 50.0 million in 2010 to 48.6 million in 2011, according to a U.S. Census report. The percentage of uninsured Americans dropped from 16.3 percent to 15.7 percent during same period.

THE NATION'S HEALTHCARE DOLLAR: WHERE IT CAME FROM, 2012

(1) Sum of components does not add to 100 percent due to rounding.
(2) Includes co-payments, deductibles, and any amounts not covered by health insurance.
(3) Department of Veterans Affairs, Department of Defense and Children's Health Insurance Program.

Source: Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group.

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  • According to the U.S. Census Bureau’s latest health insurance survey, 15.7 percent of the U.S. population lacked coverage in 2011, down from 16.3 percent in 2010.

HEALTH INSURANCE COVERAGE STATUS AND TYPE OF COVERAGE, 2008-2012

(000)

    Uninsured Insured
Year Total U.S. population Number of people Percent of population Private health insurance Government
health insurance
Individuals with some form of insurance (1)
2008 301,483 44,780 14.9% 202,626 87,586 256,702
2009 304,280 48,985 16.1 196,245 93,245 255,295
2010 306,553 49,951 16.3 196,147 95,525 256,603
2011 308,827 48,613 15.7 197,323 99,497 260,214
2012 311,116 47,951 15.4 198,812 101,493 263,165

(1) Includes individuals with some form of insurance (government, private or a combination of both).

Source: U.S. Department of Commerce, Census Bureau.

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  • Between 2010 and 2011, the number of people covered by private health insurance increased from 196.1 million to 197.3 million, while the number covered by government health insurance climbed from 95.5 million to 99.5 million.
  • Between 2010 and 2011 the number covered by employment-based health insurance was virtually unchanged at 170.1 million in 2011, compared with 169.4 million in 2010. The number with Medicaid coverage increased from 48.5 million to 50.8 million from 2010 to 2011.

TOP TEN HEALTH INSURANCE GROUPS BY DIRECT PREMIUMS WRITTEN, 2012 (1)

($ billions)

Rank Group/company Direct premiums written Market share
1 WellPoint Inc.  $51.3 11.6%
2 UnitedHealth Group Inc.  49.6 11.2
3 Health Care Service Corporation 21.2 4.8
4 Aetna Inc.  20.9 4.7
5 Humana Inc.  16.6 3.7
6 Highmark Insurance Group  11.8 2.6
7 Kaiser Foundation Health Plan Inc.  10.7 2.4
8 EmblemHealth Inc.  10.0 2.3
9 Independence Blue Cross  9.6 2.2
10 Horizon Healthcare Services Inc.  9.1 2.0

(1) Based on health insurer annual statement data. Excludes health insurance data from the property/casualty and life/health annual statements. Excludes territories.

Source: SNL Financial LC.

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  • Private health insurers’ direct premiums written totaled $418.4 billion in 2011. Life/health and property/casualty insurers wrote an additional $177.8 billion and $5.7 billion, respectively, bringing the total to $601.9 billion, according to data from SNL Financial.

HEALTH SAVINGS ACCOUNTS

Established in 2003 by the Medicare Modernization Act, health savings accounts (HSAs) are designed to give consumers financial incentives to manage their own healthcare expenses. An individual’s HSA must be coupled with a high-deductible health plan (HDHP). HSA funds may be used to cover current and future healthcare costs.

HEALTH SAVINGS ACCOUNT ENROLLMENT (COVERED LIVES), 2009-2012 (1)

  January 2009 January 2010 January 2011 January 2012
Individual market 1,832,000 2,053,000 2,358,497 2,470,840
Small group market 2,429,000 2,970,000 2,779,208 3,019,347
Large group market 3,752,000 4,986,000 6,299,460 7,939,023
Other group (2) NA NA NA NA
Other (3) NA NA NA 72,865
Total 8,013,000 10,009,000 11,437,165 13,502,075

(1) Includes health savings accounts (HSAs) and high-deductible health plans (HDHPs).
(2) Enrollment data for companies that did not break down their group membership into large and small group categories.
(3) Enrollment data for companies that did not provide a breakdown of enrollees by market category.

NA=Data not available.

Source: America’s Health Insurance Plans.

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  • According to America’s Health Insurance Plans, 13.5 million people were covered by HSA/HDHP products in January 2012, up from 11.4 million in January 2011.
  • Preferred provider organizations (PPO) products (93 percent) were the most popular product types among large-group HSA/HDHP participants.

LONG-TERM CARE INSURANCE

Long-term care (LTC) insurance pays for services to help individuals who are unable to perform certain activities of daily living without assistance or who require supervision due to a cognitive impairment such as Alzheimer’s disease. According to the U.S. Department of Health and Human Services, about 70 percent of individuals over age 65 will require at least some type of long-term care services. There were 43 million people age 65 and older in 2012, accounting for 13.7 percent of the U.S. population, or about one in every seven Americans, according to the U.S. Census Bureau. By 2030 the Census Bureau projects there will be about 73 million older people, more than twice the number in 2000.

Nearly 5 million people were covered by long-term care insurance in 2012, according to a study by LIMRA International. The average first-year premium for individual LTC coverage purchased in 2012 was $2,493, up 5 percent from 2011. In 2012, 69 percent of new long-term care insurance policies were purchased by individuals under the age of 55, according to a study by the American Association for Long-Term Care Insurance. The average age when people applied for coverage was 56 years. The age of new buyers has been slowly dropping, according to the association. A decade or so ago the age of the average buyer was between 66 and 67.

INDIVIDUAL LONG-TERM CARE (LTC) INSURANCE, 2013 (1)

  Lives Percent change,
2012-2013
Premium
($ millions)
Percent change,
2012-2013
New business 172,178 -26% $406 -30%
In-force (3) 4,850,000 (2) 9,800 3

(1) Based on LIMRA International's Individual LTC Sales survey, representing over 95% of the individual LTC market.
(2) Less than 1 percent.
(3) Includes estimates for non-participants

Source: LIMRA International.

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  • The number of Americans purchasing LTC insurance in 2012 was unchanged from 2011, while sales grew by 5 percent, based on new business.

NATIONAL HEALTH EXPENDITURES, AVERAGE ANNUAL PERCENT GROWTH FROM PRIOR YEAR, 1993-2022

(1) Average annual growth from 1970 through 1993; marks the beginning of the shift to managed care.
(2) Projected.

Source: Centers for Medicare and Medicaid Services, Office of the Actuary.

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