The steep hike in health insurance costs has generally been attributed to the rise in the costs associated with new medical technology, along with the expense of the substantial bureaucracies required to run managed care programs such as HMOs and PPOs.

An additional factor has been raised recently by a Yale School of Medicine study. They point to the aging of the nation’s population as a factor in the increase of group health insurance rates. The population in group health private insurance is becoming older and wealthier at a rate greater than the population overall, a demographic shift that can add pressure to the already strained health insurance system.

This trend makes it harder for health insurers to pool risks since fewer younger people with lower health costs are covered by these employment-based plans.

Patricia Keenan, Assistant Professor in the Department of Epidemiology and Public Health, said “Older, more affluent people are more likely to keep their employer-based coverage as premiums rise while others increasingly get public coverage or go without altogether. Population aging combined with declines from rising premiums could further destabilize the employment-based health coverage system.”

She said private coverage has been in a slow decline since the late 1980s and younger and lower-income groups have disproportionately lost coverage. Keenan said even if the population with employment-based coverage remains quite healthy, costs of coverage could increase as the average age of people with group coverage rises.

Her point is that discussion of the impact of our graying population on health insurance costs has been focused primarily on Medicare and Social Security. “Well before we see the effects of baby boomers’ retirement on Medicare and Social Security financing, population aging combined with rising premiums could place more pressure on an already strained employment-based health insurance system.”