Health care in the United States is a huge expense for everyone, and most wealthy investors expect it to become an even greater expense in the near future.
Spectrem’s new wealth segmentation study Financial Behaviors and the Investor’s Mindset asked investors to describe their current health care plans and what they think is going to happen to the cost of that health care going forward.
Among Millionaires, with a net worth between $1 million and $5 million Not Including Primary Residence, there is a great expectation of rising rates for premiums and rising deductibles. Among those who do not have Medicare for any portion of their health insurance, 35 percent are expecting to pay at least 5-10 percent more for their premiums next year. In fact, 29 percent believe they will be paying 20 percent more health insurance.
The rate of expectation for costs are less for those with Medicare paying a portion of their health insurance costs.
When it comes to deductibles, almost one quarter of all Millionaire investors are expecting an increase of 20 percent or more.
The Millionaires are segmented by occupation, and it was interesting to read what Senior Corporate Executives think about their health care insurance. They are significantly more likely than the other occupations to feel that they will be seeing increases in their premiums, deductibles and out-of-pocket expenses of greater than 10 percent. Percentage-wise, 55 percent see a 10-percent plus rise in premiums, 53 percent see a similar rise in deductibles, and 49 percent are expecting a 10-percent or more rise in out-of-pocket medical expenses.
With all the concern over costs, there is very little intention to change health care providers in the near future. Only 12 percent of Millionaires plan to change health insurance providers in the coming year, and only 8 percent plan to drop out of their group coverage they currently have through their employer.
However, 24 percent of Millionaire investors under the age of 36 do plan to change their health care provider. Twelve percent of that age group plan to drop out of their work-provided group coverage.
Just under half of Millionaires have a private insurance plan through their employer, and one-third are on Medicare with supplemental coverage.
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