State rules may push health insurance costs higher

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State laws on health coverage varyCertain rules on health insurance enforced on a state level may lead to people paying more for coverage, the results of a new study suggest.

Mark Showalter, an economist at Brigham Young University, analyzed the rules that govern health insurance in different states in the country and found that varying regulations affect pricing for individuals who purchase directly from insurers.

For example, in states that adjust pricing based on factors such as age and health status, households paid between 21 percent and 33 percent more. Showalter suggested that the measure – which is intended to promote equity – may actually penalize healthy people.

He also found that people living in states that require insurers to accept all doctors, hospitals and pharmacies – instead of choosing from a list – paid around 10 percent more.

Showalter explained that the findings help "present a picture of what would happen if consumers were allowed to buy insurance from other states."

The research was undertaken to gather information on how to potentially make health coverage less costly by permitting people to shop across state lines for health insurance.

President-elect Barack Obama has identified healthcare reform as one of his top five priorities once he enters the White House.
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