Private health insurance in rural areas: Challenges and opportunities

KEY FINDINGS: Private insurance is less common in rural areas. Rural residents under age 65 are less likely than their urban counterparts to have private health insurance coverage. This difference is driven by the unique characteristics of rural places that make it challenging to create and sustain viable private insurance pools. Chief among these are the predominance of small businesses and self-employed, part time, and low wage workers. Rural workers are less likely to have an employer that offers coverage. Among those employed by a business, only 67% of rural employees work for a firm that offers coverage. Rural businesses, families and individuals pay more for the same benefits. Because of the higher premiums paid by small businesses, employees’ share of premiums is often high. Premiums for such policies tend to be high, and typically offer less generous coverage (fewer benefits and higher out-of-pocket costs). Strategies to improve access to private health insurance have particular implications for rural areas. Some of these strategies, and the rural considerations they raise, include: Employer mandate, purchasing pools/alliances/exchanges, or tax credits for individual insurance