A Guide to Health Insurance in Oregon (OR)

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When considering the health care industry in general and Oregon Health Insurance in particular, it is sobering to reflect on the fact that in 1960 health expenditures in the United States accounted for just 5.2% of GDP (gross domestic product), but that by 2009 that had risen to 17.6% of GDP, and is forecast to reach 20% by 2020.

In Oregon, the average monthly premium for Group Oregon Health Insurance through employer sponsored insurance in 2009 was $390 for cover for a single person, and $1,065 for a family, according to the Oregon Insurance Department.

This is clearly a lot of money, but Oregon residents are not alone in having to pay such high premiums, because the national averages of $389 and $1,086 every month for single and family cover respectively are very similar.


There are seven main reasons that are commonly given for the year on year rises in the cost of Oregon Health Insurance:


1/ The high cost of prescription drugs

2/ An aging population

3/ Unhealthy lifestyle choices and Obesity

4/ Medical Inflation

5/ New technologies that cost more than current medical practices

6/ An ever increasing use of healthcare resources

7/ Having to meet the medical costs of uninsured people without Oregon health insurance


In Oregon there were an estimated 17% of the population who were uninsured in 2010, and it is estimated for example that as a whole uninsured people used $116 billion worth of health care in the US in 2009, but that of that approximately $43 was not compensated. And the argument is that insurance companies in Oregon and elsewhere attempt to recoup this money by cost-shifting the unpaid portion to normal policyholders in the form of higher premiums.

With health insurance in Oregon there are an estimated 49% of the population who are insured through Group Oregon Health Insurance Plans that are provided by their employers. But what is quite noticeable when you look at the subscription figures is quite how linked the number of employees a company has is to its likelihood of offering a group health insurance policy.

For 2009 for example, here are some figures of the number of employees that firms have in Oregon, together with a percentage of how many of them offer a Group Oregon Health Insurance Policy to their employees:

Less than 10 Employees - 34.9%
10 – 24 Employees – 54.1%
25 – 49 Employees – 83.3%
50 – 99 Employees – 81.7%
100 – 999 Employees – 93%
1000 or More Employees – 99.1%


Between 2000 and 2009 the amount of employers offering health insurance in Oregon fell by 9%, which is perhaps indicative of some of the challenges that small businesses face when they try to instigate a health insurance program in keeping it affordable enough to remain attractive.

And also perhaps of the rising issues in terms of time, money and administration costs in administering such a program, because there are very real costs involved in running these schemes at a time when 78% of the cost of the premium is borne by the employers, and only 22% by the employees.

At the same time the levels of deductibles before the employees in Oregon can receive treatment has gone up drastically, reaching $1,760 in 2009. And so there is some sense in which both parties are being squeezed.

One of the key reasons that the cost of premiums has continued to steadily climb is often laid at the feet of having to meet the expenses of the uninsured; and the Affordable Care Act, which will come fully into force in January 2014 it is hoped will address that by requiring all Americans to have health insurance or pay a fine that would be payable through the tax code.

It is hoped that with the rise in the number of people with health insurance will come more people to share the risk and costs, more competition and a fall in the costs of health insurance in Oregon and everywhere else in the United States, with one aim of the legislation being to create an extra 32 million people with insurance cover, an increase of some 10%.

Though how well this will actually work in practice is going to be difficult to judge until the act has been fully implemented, and in action for quite some time.

With regard to Oregon specifically, about 1 in 4 Oregonians are insured through The Oregon Health Authority (OHA), and they too have a number of specific health insurance objectives for the state which include:

1/Setting up a health insurance exchange by January 2014 to help in the buying process of Oregon Health Insurance.

2/ Bring in more value-based benefit plans.

3/ Create more healthy living schemes to try to ensure that less people need to use their health insurance in Oregon.

4/ Change the way that treatments are paid for to encourage higher quality service.

5/ Look into ways of making medical errors more transparent.

6/ Standardize Oregon Health Insurance paperwork systems so that it is made simpler to claim and administer.

7/ Train more healthcare workers in the state of Oregon.


There are clearly interesting times ahead for health insurance in Oregon and throughout the United States, and whilst there is change ahead, some fundamentals remain true.

The Oregon Health Insurance market is here to stay for the foreseeable future and so you still need to shop around carefully for quotes and do all due diligence before settling on a policy that is right for you and your family.


 

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