6 Reasons Health Insurance Costs Continue To Rise
Why is health care so expensive? My car payment is cheaper than my monthly premium! As we all know health care costs are on the rise in America. But, why? People that have coverage are punished for becoming sick, and others are being punished for not being covered.
We all know that health insurance is something that we must have. But health insurance seems to be more of a tax then a benefit. There are many different factors that are responsible for the increase in cost.
Listed below are some reasons why health care is becoming more expensive.
- New Technology- The new developments in technology have made great strides with helping diagnose patients, as well as increasing life expectancy. It’s hard to believe that more than 36% of hospitals now have robots performing surgeries. This seems like something out of a sci-fi movie! Even though these new advancements are helping many people, they are also very expensive to utilize. Insurance claims for new high-tech procedures are typically much higher than when traditional methods are used. We now have new tools and procedures available to us, but unfortunately many can’t afford to use them.
- Lab Tests- More customers are using medical labs, which in turn has increased the overall cost of lab testing. The labs are being used more often because the baby boomers are becoming older, which is a large chunk of the American population. Seniors need these tests to either monitor medications or to diagnose illnesses.
- Health Plan Administration- If the amount of insurance reimbursements were more than expected the previous year, the carrier will raise the cost of premiums and deductibles. They do this so they can compensate themselves for what they had to pay out. This shows that the more the insurance is used, the more expensive it becomes.
- Doctor Visits- Studies have shown that the amount of doctor visits rose 1.3%. This may not be a large percentage, but it does show that doctor visits are on the rise. Customers are also having to pay a much larger share of their medical bill than ever before. Why you ask? Because insurers are placing more of the payment burden onto customers through higher co-payments, co-insurance and deductibles. Insurers are also making customers pay way more out of pocket if they choose a doctor that is not in their network.
- Drug Cost- 80% of the drugs that are prescribed in the United States are generic. It takes a while for these generic drugs to become developed and on the market. There is a lag time before prices can adjust for a drug that goes off patent. Therefore, the customer may have to buy the original drug if the generic is not yet available, which is normally much more expensive.
- Lack of Cost Transparency- Despite a wealth of information at our fingertips, there is no quick way to understand treatment options and the costs associated with them. This lack of cost transparency means consumers cannot make truly informed decisions. You could call 5 doctors and ask how much a treatment cost and they will all ask you the same thing. What type of insurance do you have? If you don’t have insurance, most of the time they will not even give you a straight answer and tell you to call someone else.
Fortunately, there are programs that may help you save money.
We all know health insurance is expensive but there are a few programs that can make the cost more affordable.
- Some people are able to receive lower costs on their monthly premiums when they enroll in a Marketplace health insurance plan.
- Some people qualify for lower out-of-pocket costs for copayments, coinsurance, and deductibles.
- You or your child may get free or low-cost coverage through Medicaid or the Children’s Health Insurance Program (CHIP).
- If you’re under 26 you may be able to be covered on your parent’s insurance plan.
- If you’re under 30 you may be able to buy a lower-premium “catastrophic” coverage plan.
- Small businesses may qualify for the expanded small business health care tax credit.
As you can see, there are many different reasons why health insurance continues to rise. However, there are programs in place that may be able to lower the cost. HealthTN is here to help you make the best decisions according to your budget and health needs. We take the time to walk you through the process and eliminate the stress associated with picking the best plan. If you have any questions, please contact us at (615)-541-4257 and we would be happy to connect you with an agent.