One way to predict how next year looks for health care is to look at how the health insurers are pricing health plan premiums. Insurers were among the "winners" in 2020 as profit margins and medical loss ratios were favorable due to a decrease in utilization during the pandemic.
As insurers plan for 2021 open enrollment, they submit rate and plan details to federal and state regulators. This provides a window into how insures predict our health costs for next year. From this data, we see that insurers are expecting to start the year with COVID-19 in our midst with a vaccine during the year (one insurer built in a $75 per vaccine cost). Health care providers can anticipate increased utilization due to pent up demand and delayed attention to known and preventive health needs. In spite of continued uncertainty, the premium adjustments for 2021 will be moderate with most between a 3.5% decrease and a 4.6% increase (median increase 1.1%). This suggests that insurers are not expecting material increases in provider pricing.
This year, insurers set premiums for 2021 amid the coronavirus pandemic, which has created considerable uncertainty as to what health costs, utilization and enrollment will look like next year. In 2020, many insurers have provided premium relief and/or voluntarily waived cost-sharing for COVID-19 treatment for their members due to excessive profits and low medical loss ratios during the pandemic.