Challenges of Health Insurance

In 2010, health insurance became mandatory for all American after the signing of the health reform bill by President Barack Obama. According to "Health Care Challenges for the 21st Century," a report published by the U.S. Government Accountability Office, or GAO, the decision was made to alleviate the crisis faced by the U.S. health care system, which is draining the Federal budget. However, health insurance still faces many challenges to come.

Scope of the Coverage

• One challenge faced by an insurer regarding her health insurance policy is whether or not she will actually be covered by the insurance, especially if the policy is provided by the insured's employer.

  The first is the fully funded policy; this is the conventional type of policy where the insurance company pays for the claims filed by an insured employee of a particular company. The second type of policy is the self-funded policy; here, the employer pays for the claims filed by the insured employee in the event that the insurance company declines a claim for coverage.

  According to Advocacy for Patients With Chronic Illness, Inc., employees with self-funded health insurance policies don't qualify to seek an external appeal in the event that both the insurance company and the insured's employer declines to cover a particular treatment.

Rising Premium Rates

• According to "Health Affairs," a journal on health policy founded under the aegis of Project HOPE, health insurance premiums are increasing faster than the cost of living. The GAO points to expensive medical technology used for diagnosing and treating patients, the introduction of innovative drug therapies and high consultation and procedure fees charged by doctors and hospitals as some of the factors that contribute to the constant increase of health care itself.

Stability of Health Insurance Companies

• In an article published in a July 2004 issue of "Health Affairs," there is much concern over the ability of health insurance companies to stay afloat. "Health Affairs" points out that one of the primary reasons for the instability of health insurance companies is the numerous lawsuits filed against them by groups of physicians.

  In 2004, a class-action lawsuit filed in the District Court of Miami states that between the years of 1990 and 2002, several private health insurance companies, including Aetna, Prudential and CIGNA, utilized unethical business practices in terms of paying their respective accredited physicians. In 2010, Aetna and CIGNA settled with the physicians by paying them $1 million.