Building quality is in no insurance model

Markets · Jul 2026 · 6 min read · 22 sources

Damp and mould in US homes cost USD 22.4 billion a year in allergic rhinitis, acute bronchitis and asthma, by the 2016 estimate of the economist David Mudarri. Mudarri built the figure with a model from earlier studies. In June 2026, I went through 22 sources for [a report for The Built Review](https://thebuiltreview.com/reports/insurers-buildings-blindspot), and none showed a health, life or property insurer that uses data on the health of a building to set its prices.

Written by

Christian Huser
neuecon partners

I would link the asthma claims of one regional pool of members to damp and a history of mould in each home.

A curved white staircase from above with one person on it.

UnitedHealth measures its housing programme in homes

UnitedHealth Group is the largest health insurer in the US. In June 2025, it reported that it had invested more than USD 1.2 billion in affordable housing since 2011, money that helped to create and preserve 32,000 homes in 33 states and the District of Columbia. The total stood at USD 400 million by 2019 and USD 1 billion by May 2024. These are the company's own figures. Its reports that I read say nothing about damp or mould in these homes.

The USD 115 less in health care costs per member per month that is quoted with the programme is not a UnitedHealth figure. In 2016, the health services researcher Bill Wright and his team at CORE, the outcomes research centre of Providence Health & Services in Portland, analysed the Oregon Medicaid claims of 1,625 residents of 145 affordable housing properties. Costs fell by an average of USD 115 per member per month, and only in properties with integrated health services. Wright and his team compared costs before and after, with no control group. Enterprise Community Partners commissioned the study. In 2022, the Yahoo Finance reporter Anjalee Khemlani attributed the figure to UnitedHealth without naming the study.

UnitedHealthcare, the health insurance business of UnitedHealth Group, wrote in a press release of March 2019 that emergency room admissions dropped 60% "in one state" for homeless Medicaid members in a housing programme. The release does not name the state, and it gives no sample size or method. It is no longer in the company's newsroom, and the Internet Archive keeps a copy.

US law allows four factors in individual premiums

In the US individual and small-group market, the Affordable Care Act lets premiums vary by cover for an individual or a family, by the rating area, which is a region of a state set for pricing, by age and by tobacco use. The oldest adults may pay at most three times as much as the youngest, and smokers at most 1.5 times as much as non-smokers. The rule is in 42 U.S.C. § 300gg. Medicaid managed care plans, which private insurers run for the public Medicaid programme, test social risk factors such as income and neighbourhood. In Switzerland and Germany, social health insurance rules out pricing by individual risk almost entirely.

Mudarri widened the estimate from asthma to four diagnoses

Mudarri's figure is the last of four US estimates of the health costs of indoor environments. In 1997, the indoor-air researcher William Fisk and the physicist Arthur Rosenfeld made the first national estimate of the health and productivity costs of indoor environments. In 2000, Fisk estimated that better indoor environments could avoid USD 6 to 14 billion a year in respiratory disease, USD 1 to 4 billion in allergy and asthma and USD 10 to 30 billion in symptoms of sick building syndrome, which come on in a building and ease outside it. He put the gains in productivity, which are not a cost of illness, at USD 20 to 160 billion a year. Fisk reported each range on its own and never added them up.

The step from USD 3.5 billion to USD 22.4 billion comes from counting more. In 2007, Mudarri and Fisk attributed 21% of current asthma in the US to damp and mould in homes, about 4.6 million cases, at a cost of USD 3.5 billion a year. In 2016, Mudarri added three groups of diagnoses and counted more kinds of cost in each group: USD 3.7 billion for allergic rhinitis, USD 1.9 billion for acute bronchitis, USD 15.1 billion for asthma illness and USD 1.7 billion for asthma deaths. For each illness, he took the share that earlier studies attribute to damp and mould and applied it to national counts of cases and their cost.

The objections come from actuaries and economists

Social risk factors added little to the models with which Medicaid adjusts its payments to the health of members. In 2025, the actuaries Rong Yi and Jeffrey Milton-Hall and colleagues at Milliman tested them for the Society of Actuaries Research Institute. The social factors "explained much less variation in estimated risk" than the existing groups of diagnoses, and under one method of sampling, the financial effect of adding them was "effectively undetectable". Yi and Milton-Hall reported that the records of individual members did not reliably hold data on their social conditions. Their data described areas such as neighbourhoods.

In 2018, the health economist Len Nichols and the health management researcher Lauren Taylor argued that an insurer cannot keep the benefit of what it spends on the social conditions of its members. Members switch plans, and the competitors gain the healthier members.

In 2020, the health economist Amy Finkelstein and colleagues ran a randomised trial of the programme of the Camden Coalition, which gives social support to patients with high costs. Among my sources, it is the only randomised test of such a programme. The programme had no effect on readmissions to hospital. In MIT News in January 2020, Finkelstein explained that such programmes start when patients are sickest and most expensive, and that their costs fall afterwards with or without the programme. I think her argument applies to the USD 115 from Providence and to UnitedHealth's 60%, as both compare costs or admissions before and after a programme.

Where the data could come from

I found no dataset that links measured indoor conditions in homes to insurance claims and is large enough to test Mudarri's estimate. In March 2024, Chubb became the first property and casualty insurer to join the Well Living Lab Alliance, in an advisory role with no effect on its underwriting or its premiums. In 2025, the International WELL Building Institute reported about 3,000 homes certified or precertified under its standard, out of more than 40,000 enrolled in its programme for homes. I think 3,000 homes are too few to build such a dataset from certification records alone. The institute sells the certification, so these are the vendor's own figures.

I would start with asthma

I think the law explains only why the building is missing from premiums in the US individual market. The four rating factors govern premiums, so an insurer could still use building data in care management, the organisation of treatment and support for its members, in its risk models and in its investments. Yi and Milton-Hall's result rests on data about areas, and I read it as a reason to test data on single buildings. I would link the asthma claims of one regional pool of members to damp and a history of mould in each home. Asthma illness, at USD 15.1 billion, is the largest part of Mudarri's USD 22.4 billion. The test would show whether the 21% of asthma that Mudarri and Fisk attribute to damp and mould appears in the claims of that pool. It would compare members in damp homes with members in dry homes at the same time, which avoids the before-and-after figures that Finkelstein questioned.

Sources

Related

Markets · Jun 2026

Germany has not added up the cost of its indoor air →