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Health Care Reform:

Health Insurance & Affordable Care Act

How Health Reform Affects Insurance Costs: FAQ

Your health care costs under the health reform law depend on where you get your health insurance and how much money you earn. Here are answers to some common questions.


I work for a large company. Will my premiums keep going up, and if so, is this because of health reform?

Premiums have been going up for years, even before the health law took effect. Because the cost of medical care rises each year, so does the cost of health insurance. Although the law seeks to lower health care costs, we’re all paying more for our health insurance benefits and for the cost of getting care.

However, the law requires large employers to pay additional fees and taxes. That may continue to increase your employer’s costs, which may be passed along to employees.


I buy my own insurance and I've been shocked by big jumps in the cost of my premiums. Do I have to keep worrying about this?

The price of premiums does continue to rise, but at rates lower than initially expected. And, most people willing to shop for a new plan each year during open enrollment have been able to keep their premiums the same, or in some cases, lower than what they were the year before.

Under health reform, if your insurance company wants to raise premiums by 10% or more it must publicly justify the increase. This can help  keep premium hikes in check. However, not all states have the power to stop rate increases if insurers refuse to reconsider.

I smoke. Can a company charge me more for health insurance?

Yes. Insurance companies can charge you up to 50% more for premiums than someone who doesn't use tobacco.

On the other hand, smoking-cessation programs are one of the benefits that all health plans sold on a state's Marketplace must offer. 

I've heard that I might get a rebate from my health plan if it doesn't spend enough on health care. Is that true?

Yes. Health plans must now spend at least 80% of the premiums they charge customers on:

  • Medical care
  • Steps to improve the quality of care

If they spend less than this percentage, health insurance companies have to send out rebates to customers.

However, employers who are self-insured don't have to follow this rule. A self-insured employer is a company that pays the workers' medical claims itself.

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