Inflation, increasing prescription drug costs, and chronic clinical workforce shortages are just some of the factors driving up the cost of healthcare in 2024. Cost of care is a major concern for payers and consumers, so it’s no surprise this topic has been in the news frequently. In this article, SKYGEN looks at what’s trending in the cost of healthcare.
Larger Employers Will Absorb Rising Cost of Care in 2024
According to Mercer’s National Survey of Employer-Sponsored Health Plans, U.S. employers expect the total health benefit cost per employee to rise 5.4% on average in 2024. However, large employers are absorbing this increase rather than raising premiums for their employees. Employees will continue to pay for the same 22% of total health plan premium costs, on average, as they did in 2023 and 2022.
The same is not true for individuals and families purchasing their insurance through Affordable Care Act Marketplaces. Most 2024 ACA Marketplace plan premium increases are in the 2% to 10% range, with a median increase of 6%.
People are Concerned About Healthcare Costs
With inflation hitting consumers right in the pocketbook, cost of care is top of mind for most. Eighty percent of consumers say affordability of healthcare is very important for 2024 presidential candidates to talk about. In fact, cost of care is second only to inflation in terms of issues they want to hear about from candidates.
Cost is a Barrier to Getting Dental/Vision Insurance
Of the 5,000 consumers contacted for SKYGEN’s PULSE 2023 Report, about one third reported they do not have dental or vision insurance. The 2023 Pulse Report queried consumers about their thoughts on specialty providers, utilization of benefits, and the value of dental and vision insurance. When asked about the top reasons they lack dental/vision coverage, cost was reported as the top reason.
The connection between the cost of care and unmet health needs continues to be reinforced. A new study published in JAMA Ophthalmology found that health insurance coverage gaps and uninsurance were associated with a higher risk of unmet vision care needs among adults. In the findings, nearly half of adults who did not have insurance and 27% of those who had gaps in coverage reported unmet needs for vision care.
Cost is Also a Barrier to Utilizing Dental/Vision Insurance
Despite having healthcare insurance coverage, consumers say out-of-pocket costs can prevent them from using their benefits. XP’s State of Vision Health 2023 research revealed out-of-pocket cost was the most common factor preventing employees from taking care of their vision, and more than half of those surveyed said they pay a lot out-of-pocket for their vision care in addition to their insurance premiums.
There’s a similar trend in oral health care coverage. In SKYGEN’s 2023 PULSE Report, 29% of consumers believed that seeking early dental care would be too costly, while an additional 17% assumed that their specific dental issue wasn’t covered by insurance, leading them to defer treatment until the situation escalated to an emergency. Another study found that while nearly all of U.S. adults say they understand dental disease can increase potential risk for disease, nearly 50% have declined or delayed dental treatment, with 53% indicating cost as the top reason.
Interestingly, SKYGEN’s PULSE 2023 Report also found that a majority of consumers undervalue their dental and vision insurance, ranking it lower in significance compared to almost all other types of financial investments, such as home insurance, retirement and savings.
How SKYGEN Can Help
We understand that controlling dental and vision benefits costs while providing access to quality care is a top priority for payers. Our SaaS benefits automation solution for dental and vision positions payers to drive process efficiencies and improve access to care. For payers that require a comprehensive suite of services powered by technology, our TPA specialty benefit administration solution enables payers to meet these goals.
We also help payers improve member engagement and communication with digital tools like our member mobile app and self-service portals for managing specialty benefits and even shopping for and selecting the right plan. To find out more about SKYGEN’s solutions for managing cost of care, get in touch with our dental and vision benefits administration experts.