The Reasons for Rising Healthcare Costs in the U.S.
Imagine, for a moment, walking into an electronics store 10-15 years ago. Items such as smartphones, flat-screen televisions and laptop computers (which were probably less efficient than today’s models) were likely two-three times as expensive as they are in the current market. Yet if you fell in the store, broke your leg, and had to be rushed to the hospital, you would have paid less for the care that you received then than you would for similar treatment today.
Why the diverging patterns? Electronics providers (as well as those in most other industries) will typically take their technology and/or products and improve them while also making them more affordable for consumers. The healthcare sector, on the other hand, is one of the few industries where the price for services rises as treatment methods improve. How are these cost increases felt? Well, if you’re an employer, they mean having to pay more for group healthcare benefits plans. If you’re a consumer, they make it more difficult to afford reliable medical insurance.
Factors Influencing Healthcare Costs
What are the reasons behind these skyrocketing healthcare costs? There are many, each of which, while distinct and separate, directly influences the others to cause prices to rise. They include:
How Are Insurers Responding?
Some health insurance companies have taken a proactive approach to addressing rising healthcare costs by focusing more on health management, offering consumers incentives such as lower premiums for healthy practices and high-deductible plans while ensuring providers complete reimbursement for services meant to keep patients out of the hospital, such as preventative visits and telephone consultations. For more information on plans employing such methods to keep costs low, contact us at (707) 823-3689, and subscribe to our blog.