It costs less to rent a two-bedroom apartment in New York City than to have health insurance there, according to a New York Post investigation of data from the state insurance department in Albany.

The Post’s investigative reporters found the average monthly health insurance premium for families living in New York City is $4,354, a 13 percent increase over the premium cost for the same policy in 2008.

“That exceeds the $3,947 monthly rent for a place in a no-doorman building downtown,” wrote Post reporter Brendan Scott.

Government Policies to Blame

“One of the main reasons health insurance premiums are skyrocketing further and further upward is that thousands of young, healthy New Yorkers are deciding to drop health coverage altogether because of the extreme cost involved to maintain it,” said Devon Herrick, Ph.D., a health economist at the National Center for Policy Analysis. “This has the effect of driving up prices even more because private insurers are more and more left with a sicker and hence costlier base of clients.”

Paul Howard, director of the Manhattan Institute’s Center for Medical Progress, says government policies are directly responsible for the high insurance prices.

“New York’s policymakers bear great responsibility for making the state’s private direct-pay [health insurance] markets extraordinarily expensive and dysfunctional,” said Howard.

“Primarily through guaranteed access and community rating regulations, private health insurance markets are being forced to drive up the cost for younger, healthier New Yorkers — who then drop out of the markets,” Howard explained. Guaranteed access forces health insurers to accept older and less-healthy clients, and community rating keeps insurers from matching premiums to actual risk.

Government Policies to Blame

Edmund Haislmaier, a senior fellow in health policy studies at The Heritage Foundation in Washington, DC, agreed, saying, “Government policies are one of the main reasons for the extraordinary cost increases in the health insurance market.

“We have a [government-imposed] system of ‘spend more, charge more,’ with little accountability and even less interest in whether value is being maximized,” Haislmaier added. “About half of what we spend on health care is wasted. Government has not implemented policies that maximize value and has made policies which make it more difficult to maximize value.”

Howard expects insurance rates to rise again in 2009 “as health insurance companies pass along over $850 million in new taxes, which were included in the recent state budget, to consumers.”