Medical expenses in the US continue to skyrocket. Findings from a recent study by the John Hopkins School of Public Health determined that the US has the highest cost of healthcare in the world. Medical spending in this country is expected to reach $6 trillion by 2027. This steady increase is becoming a considerable burden for patients and the economy. But what are the drivers of higher hospital patient costs? And are there any ways to control them?
Factors Driving Higher Medical Expenses are Numerous and Complicated
The main influences on higher patient costs are multifaceted and often in flux. There are also variations depending on region and state. There is no clear-cut answer to what is becoming an epidemic. Since the US operates a for-profit healthcare system, any reduction in patient costs impact the viability of health systems, further complicating the situation.
Why Are Patient Costs Rising?
Much of the rising costs of healthcare are related to population growth and aging. According to a study in the Journal of the American Medical Association (JAMA), healthcare spending increased by $933.5 billion from 1996 to 2013. The study looked at the “why” of this increase, finding five factors:
Regarding service price, the reality is that Americans were charged for healthcare products and services. Much of this was due to new or technically advanced treatment. As the intensity of care increases, so do overall costs. This study reaffirms that US citizens pay higher prices for healthcare than any other country. There are calls from experts, stakeholders, and the medical community to address what some call price gouging. That’s great, in theory, but a huge challenge considering all the factors that go into patient costs.
What’s Driving Up Medical Expenses?
There are many underlying and correlating factors that drive prices and utilization. Many issues are increasing patient cost sharing, which includes deductibles, coinsurance, and copayments. Let’s look at this key causes of higher medical costs.
There are consequences to higher patient costs. Individuals are faced with higher costs that they can’t reduce without impact accessibility to healthcare. This reduces disposable income and consumer spending. It also limits economic growth and restricts wages.
The future of healthcare spending is a huge gray area right now and a concern for all those involved, including those that provide services and products to the healthcare industry. Keeping a pulse on this issue will be vital to how you approach the industry now and in the future. Stay on track with this trend and many others affecting healthcare by subscribing to our blog.
About the Author
Carevoyance contributor Beth Osborne is a professional writer and content marketer with multiple years of experience in healthcare IT marketing. Learn more about her by visiting her website.