Q:

What influences the cost of your health insurance?

A:

Quick Answer

Factors that influence the cost of health insurance include the age and location of the insured and the category of plan insurance, according to Healthcare.gov. The underlying cost of providing health-care services, the cost of medical lawsuits and the age of the overall population in the insurance pool also influences health insurance costs, explains PBS NewsHour.

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Full Answer

Health-insurance rates are lower for young people than they are for older people. In addition, because regulations vary from state to state, rates depend on the location of the person insured, explains Healthcare.gov. Smokers and other tobacco users usually pay more for health insurance.

The type of insurance plan also influences the cost of insurance, according to Healthcare.gov. If a plan has higher out-of-pocket costs, the insured pays a lower premium. If the plan requires fewer out-of-pocket costs, the insured pays a higher premium.

The age of the entire insurance pool affects the cost of insurance because the insurance provider must average risks among the pool, says PBS NewsHour. As the U.S. population ages, the cost of insurance rises. If a large number of people in the insurance pool have chronic health conditions such as heart disease or diabetes, the members of the insurance pool pay higher premiums, explains PBS NewsHour.

The number and cost of health-care services that the health-care industry provides to the members of an insurance pool also influence the ultimate cost of health insurance. As medical technology improves, the cost of providing medical services rises. With this cost increase comes a corresponding increase in the insurance that pays for those services, explains the Kaiser Family Foundation.

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