Rising Costs Could Fuel Market for Catastrophic Health Insurance

With little end in sight to rising medical costs, catastrophic health insurance could be one way that workers and families use to secure basic coverage while making ends meet.

A recent report from the Robert Wood Johnson Foundation warns that without significant reforms to the healthcare industry, out-of-pocket medical costs for families will rise by as much as 35 percent in the next decade. This is especially of concern given how much costs have already risen for basic healthcare costs in recent years.

The report also warns that during this same time period, businesses in at least 27 states would see their insurance premiums double. This is particularly bad news for workers because it could force more companies to drop their medical coverage benefits.

"While enacting health reform will be difficult and expensive, the cost of failure would be considerable for every state in the union, and affect every community," said John Holahan of The Urban Institute.

One strategy people in need of affordable coverage often use is to purchase a catastrophic health insurance plan, which offers coverage against serious illness or accidents and the devastating medical costs that can come with such things.