Every year, the Milliman insurance industry consulting firm issues a report that estimates the average cost of health insurance and copays across the population of Americans, along with various other insights.
Here are some of the report’s findings:
· Cost increases in Healthcare have been most “moderate”. For the average American, the study found the healthcare costs increase by 4.1% between 2019 and 2020. This is consistent with the 5 previous years, and have actually decreased from 10 years ago, where the rate of healthcare cost increase was nearly double.
· In 2020, the hypothetical healthcare cost for an average American is $6,553 a year, while it is $28,653 for a “typical family” of four. The study recognizes that there are varying of family structures that would influence the cost of healthcare on average.
· With COVID-19 in the picture, the study estimates that the virus will have huge impacts on health care costs for 2020. On one end, massive increases in cost for direct COVID-19 care. Interestingly enough however, there will likely be an exceptionally large decrease in cost for deferred and forgone services, which could actually dwarf the increased spending due to COVID-19. There is tremendous uncertainty how the numbers will play out in the end, so the study did not make explicit adjustments to medical care cost projections.
It is important to note that the study focuses on the average, which means for people who experience significant health conditions, the numbers will be higher. And for people who manage to stay healthy until the day they die in their sleep without requiring extensive medical care or hospitalization, the costs could be much lower.
This article was written by an independent writer for Brewster Financial Planning LLC and is not intended as individualized legal or investment advice.