From Benefits Pro:
... Health care costs have increased in the economy at a much higher rate than anything else, concurrent with an increase in demand for health services driven by the health care system itself.
In 1982, the average consumer went to the doctor 1.8 times per year; by 2015, that number had increased to 5.5 times per year per average consumer. Frequency and volume of patient visits has risen with the acquisition of most primary care practices and specialists by large health care systems who own hospitals. Providers within hospital-owned health care systems are encouraged to “churn” patients, meaning refer to other specialty providers within the health care organizations to drive more billings and revenue. A lack of transparency has made it easy for high health care costs to be hidden, with the justification that “it doesn’t harm the employee, because once they meet their deductible and out-of-pocket limit, it all be covered for them.” Who hasn’t heard that comment when they question a health care bill?
Today, the average employee health plan deductible has increased to $1,500, while the out-of-pocket max for individuals exceeds $6,000. At the same time, wages have remained relatively flat, so more and more of today’s wage earners’ paychecks are going to pay health care expenses. In 2017, health care expenses accounted for 17.9 percent of GDP.
Concerned employers who see these costs continuing to rise are looking for new ways to address and attack the issues, and the good news is that solutions do exist.
Rising RX costs add to the problem. Pharmacy costs have grown from less than 10 percent of employer health care spend to more than 20 percent of claims today. Much of the increased RX spend comes from higher cost specialty drugs being marketed and priced to maximize profits for the pharmacy industry and those receiving rebates.
Concurrently, insurance companies drive profits by creating formularies based on maximizing drug rebates pharmacy manufacturers pay them, rather than pushing formularies based on lowest costs for employees and employers. ...
