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Big premium hike? Blame it on the kids

Courtney Perkes, Kaiser Health News on

Published in Health & Fitness

Dede Kennedy-Simington, an insurance agent in Pasadena, Calif., was "totally dismayed" when she learned recently that the premium on her family's Blue Shield PPO would rise $391 a month next year -- driven largely by huge increases for her two teenage children.

The cost of insuring her 16-year-old daughter will spike 60 percent in 2018, and it will jump 38 percent for her 13-year-old son.

The price surge stems from a change in federal regulations that allows insurers to recalculate the health risks of children within a family's premium bill.

"This hurts us, but it will be a total non-starter for a lot of families," Kennedy-Simington said.

Despite the policy change for kids, they will still be considerably cheaper to cover than their parents. In Kennedy-Simington's case, her two teens account for more than half of the premium increase but less than one-third of the total 2018 premium.

Premiums are rising for a lot of reasons next year. Among the most publicized is a decision by the Trump administration to stop paying insurers for certain subsidies they provide to low-income health plan enrollees under the Affordable Care Act.

Another factor is the complicated new rule, approved last year by the Obama administration, that allows insurance companies to assign more of a family's overall premium cost to children in individual and small-group policies, starting in 2018.

It also allows insurers to charge higher rates for teens than for younger children beginning at age 15, because teenagers typically rack up bigger medical bills. Up until now, the ACA has not allowed any difference in the amount charged for children from birth to 20.

"A 15-year-old running around on his bike has more chance of something happening to him than a 7-year-old playing video games," said Ron Goldstein, CEO of Choice Administrators, an Orange, Calif.-based health insurance exchange for small businesses. "You get into high school, there's football and contact sports."

Open enrollment for 2018 coverage in the individual market, on and off the health insurance exchanges, started Wednesday.

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