In 2016, there was little difference between average claims cost among individual, small and large group plans. However, individual market premiums remain lower than premiums in the small and large group markets, according to a Leavitt Partners analysis.
For the study, titled "Nationally, Individual and Group Market Costs Increasingly Similar," Leavitt Partners consultants calculated national premiums and claims per member per month for the individual, small and large group markets. The consultants used financial data from the National Association of Insurance Commissioners from 2010 to 2016.
Here are three findings.
1. Total claims costs for the individual market were $162 per member per month in 2010. That is 78 percent lower than the $288 per member per month claims cost in the large group market.
2. In 2016, those differences in costs across the individual and large group markets fell to 3 percent. Claims cost per member per month rose to $350 for the individual market and $360 for the large group market.
3. In comparison, premiums in the group and individual markets remained different. In 2016, individual market premiums stayed 15 percent below group market rates, on average.
"While medical costs in the individual market have already converged with the small and large group market, individual market premiums will likely continue to rise in the coming years until they too converge with the broader commercial market," the consultants concluded.