Health insurance woes: Americans ready to drop coverage if costs keep rising
The Biden-Harris administration helped expand access to health insurance coverage during the COVID-19 pandemic, but rising costs may still cause some Americans to drop insurance coverage altogether.
That’s according to a recent survey from ValuePenguin, which found 39% of insured Americans would consider dropping health insurance if it got too expensive. The findings come at a time when inflation has reached historic highs, and Americans are feeling the pinch as costs for everything have risen. While healthcare costs, including health insurance premiums, were largely baked in for 2022 through the year, costs are likely to rise next year.
A whopping 74% of Americans said they are worried about rising insurance costs, the survey found. That figure was higher among Americans making between $75,000 and $99,999 (82%), baby boomers (80%), parents whose children are all 18 or older (77%) and women (77%).
A third of Americans agreed health insurance is too expensive for the value, while 37% of both millennials and Gen Xers say their insurance premiums are too high.
“Beyond the generational look, six-figure earners are the most likely to say their premiums aren’t worth the value,” ValuePenguin found. “Among insured Americans making $100,000 or more, 42% find their premiums too expensive, compared with just 24% of insured Americans making less than $35,000.”
There are plenty of Americans who are fine with what they are paying for insurance, including 67% who think their insurance premiums are fairly priced or inexpensive, “leading with consumers making less than $35,000 (76%), Gen Zers (74%) and divorced consumers (74%).”
That may be because 69% of Americans spend less than $500 per month on insurance, and 53% spend less than $250 per month. Only 15% said they spend $500 or more a month on health insurance, and 1% spend at least $1,500 monthly on insurance.
“Regardless of what they’re paying now and whether they think it’s worth the cost, consumers have their limits,” the survey noted. “When it comes to how much more they’d be willing to shell out, they’d draw the line at an increase of $364, on average.”
If insurance became too expensive, many Americans (39%) say they would consider foregoing insurance. That worrisome finding is actually much higher among millennials (52%), and more than half of Americans making less than $35,000 also say they’ll forgo insurance if the price gets too high.
Despite higher prices, 70% of Americans plan to stick with their current health plan next year. Nearly one-quarter (23%) say theft will make changes or switch plans, and 7% will go without insurance in 2023. Among those looking to make a change, 63% want to switch to a cheaper plan.
If Americans didn’t have to shell out so much for health insurance coverage, many survey respondents said they would use the funds to pad their savings and pay down debt.
The survey comes as open enrollment for the 2023 health plan year has opened, concluding Dec. 15, 2022 for Jan. 1 coverage.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."