Unsustainable insurance

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June 25, 2012

Dear Sir,

It’s that time of year for some of us when our private health insurance premiums have been reviewed and adjusted. Inevitably adjusted upward. Now, I know that depending on the group plan one is part of, the premium adjustment varies. But for the sake of argument, I’d like to take my own situation as an example. I am retired, but still participate in the group plan that I am a member of, (paying 100 percent of the premium). My monthly premium was $706 and has now increased to $776 — a ten percent increase. The increase has averaged close to ten percent each year. But, again for the sake of argument, let’s say the increase averages eight percent. I recently did the maths on this. I am 60 years old. Assuming I live another 30 years, and based on an average eight percent annual premium increase, by the time I am 90 years old, my monthly premium will be — get this — $7,808 or $93,696 per year! I realise inflation figures into all this, but not at the rate required to make health insurance sustainable. Oh, and I’m married. My husband also pays at a similar rate. So double that annual premium amount for our household! We’ll be bankrupt long before we reach 30 years.

A working person, whose employer pays half, is also in a very bad situation. Salaries are not increasing at the same rate, and so in 30 years’ time, how could anyone afford to pay even half of the premium out of their salary and have a living wage remaining? Our retirement income dropped this past year by about 20 percent, but our healthcare costs just keep spiralling upward. The cost of insurance will become unsustainable for the average Bermudian as time goes by. Can anyone tell us what the future will hold for all of us in relation to health insurance in Bermuda? It just doesn’t seem the private insurance system will work over the long run.

CONCERNED RESIDENT

Paget

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