Here Comes the Next Affordability Crisis
Projections from Marsh, a health-care-consulting firm, imply that GLP-1s will account for up to a quarter of next year’s rise in costs compared to the preexisting trend.
Key points
- “And the current projections are likely an understatement.” Much of the increase will be passed on to employees—either directly, in the form of higher premiums, co-pays, and deductibles, or indirectly, in the form of reduced benefits, smaller raises, and slower hiring.
- The biggest reason this is all happening is deeply perverse: A law designed to end surprise medical billing has turned into a tool for squeezing even more money out of insurers and raising the cost of care for everyone else.
- But these products are designed to hunt for and maximize revenue from moments during an appointment that a doctor ordinarily might not bill for, such as noting a patient’s chronic disease during a routine checkup.
Analyses from Marsh and the Business Group on Health imply that AI coding inflation will explain up to a quarter of next year’s extra health-insurance inflation.
Next year’s projected increase is being driven by three additional factors.
Additional details
- Before 2022, if a patient visited an in-network hospital but received care from an out-of-network provider, their insurance would typically cover only the in-network rate, and the patient would receive an unexpected bill for the remaining amount.
- If the two sides couldn’t come to an agreement, they would enter a process known as independent dispute resolution, or IDR, in which both parties would submit their desired payment amount to a third-party arbitrator.
- Government agencies estimated that the law would give rise to only about 17,000 of these disputes a year, given that both sides would likely want to avoid the risk of having to accept the other’s number.
- The cost of employer-provided health coverage—the kind that 160 million Americans get—is expected to rise by as much as 11 percent, roughly double the average annual increase over the past decade.
- The reasons for this trend are well-documented: an aging workforce in need of more care, an increase in the prevalence of chronic illness, and a dramatic consolidation of the hospital sector.
How this summary was made: extractive summary — built from the sources' own reporting. It is drawn only from the reporting of the sources listed below — read the originals for full detail. How we summarize →
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