Host: What factors determine health premiums?
Bob Hurley: I am often asked, "What factors go into determining my health insurance premium?
" In the individual market where many families are now finding themselves buying their own health insurance there are many factors that go into determining your price. Most of the products are off-the-shelf what we call off-the-shelf they are pretty defined products with pre-defined pricing, but it maybe that when you go through underwriting depending on the area of the country you live in, you could have your rate increased based on a pre-existing health condition that you might have. So that's certainly one of the ways that your price can be affected.
So basically, geography can determine your price, so the prices are different all across the country, some of that is determined by the cost of care. What is the cost to provide care in your particular area? Some of it has to do with Government regulations that exist in your specific area. Some states are very heavily regulated; other states are not as heavily regulated. Those that have less regulation typically are less expensive so that can play into it. More on a personal level what gender you are can drive pricing in some areas of the country. Some areas have neutralized that issue; male and female prices are the same. Others, you are going to pay a little bit more if you are female and younger and child bearing age whereas men often, will pay a little bit more as they grow older because the health status of males is typically not as good as females as they get older. So that can play into the premium for your health insurance coverage. Then finally, obviously, the amount of coverage you are going to buy, the level of benefits that you choose to buy for yourself and your family is going to affect the pricing. The more comprehensive plan that you want that has little or no contribution from you as far as the deductible goes, it's going to be more expensive than a health insurance plan that does include contribution from you with regard to a deductible.
So just like your car insurance the higher the deductible, the lower your premium the same applies for a health insurance. The higher the deductible on your health insurance plan, the lower the premium is going to be.