Gap widening between premiums paid in, benefits paid out for health insurance

TORONTO - If it feels like you are paying more for and getting less from your extended health insurance, you are not mistaken.

A new analysis shows that the gap between premiums paid in and benefits paid out has widened substantially in the past 20 years.

The study says that difference rose to $6.8 billion in 2011 from $1.2 billion in 1991 for health plan providers in Canada that operate on a for-profit basis.

That $6.8 billion figure is the portion of the premiums paid by companies and workers that is retained by the insurance companies.

Lead author and health economist Michael Law says he cannot tell from publicly available data whether the extra money is going to higher dividends for shareholders or higher administrative costs.

The analysis is published today in the Canadian Medical Association Journal.