Americans spend $3.2 trillion each year on healthcare cost services. That amount is expected to rise to over $4.5 trillion by 2026. The Affordable Care Act has helped millions of Americans get health insurance, but some experts say it has also created a new problem: skyrocketing medical bills. What's going on?
Healthcare spending grew at nearly double the rate of inflation from 2000 to 2016, according to the Centers for Medicare & Medicaid Services. In 2017, overall spending rose 4% compared to the previous year. Spending on hospital care increased 7%, outpatient care grew 3%, and prescription drugs rose 6%.
There are two main reasons behind rising healthcare costs. First, hospitals are becoming more efficient at providing better quality care. Second, patients are now being treated in multiple locations instead of just one or two. This means they're paying out-of-pocket for their treatment. If you want to save money on your healthcare expenses, you'll need to take action. Here are five ways to lower your costs.
1. Insurance Premiums Are High
According to the Kaiser Family Foundation, the average premium for employer-sponsored family coverage was $16,058 in 2018. And the majority of people under age 65 have individual policies that healthcare cost about $1,800 per month, according to the United States Department of Health and Human Services. Those premiums can go up if you let them lapse. Otherwise, you might have to pay higher rates when you sign back up next year.
Additionally, private insurers can charge older customers significantly more than younger ones because federal law prevents them from charging those aged 50 to 64 more than three times as much as they trust individuals under 30. People 55 and older can pay hundreds of extra dollars a month for insurance, even though they may not use any services provided by a hospital or doctor. It’s no wonder why so many people are deciding against buying insurance.
2. Hospital Bills Can Be Unbelievably High
Hospitals tend to be expensive places. They operate 24/7 and deal with sick people all day long. Add to this mix malpractice suits, which are rampant throughout America — especially in rural areas — and hospital expenses can add up quickly. A recent study found that patients who sued spent an average of $9,000 more than other patients after being discharged from the hospital.
If you don't have health insurance, you could quickly rack up huge bills. For example, the average non-Group policy (purchased directly through employers) costs $11,400 annually for single coverage and $24,100 for family coverage. These prices exclude any potential tax credits or subsidies.
3. You Have To Pay Up Front, Even For Preventive Care
To receive reimbursement from insurers, doctors must accept what are known as “global payments." This means at healthcare cost institute they bill insurers based on how much they think they will make from seeing the patient. It doesn't matter whether the service is needed or helpful. Global payments encourage unnecessary testing and procedures. About 40 percent of total U.S. healthcare expenditures are billed using international payment methods.
If you try to talk your doctor into accepting cash in exchange for their time, you risk getting denied further medical treatments.
4. The Treatment Process Isn't Always In Your Best Interest
Many people assume that going to the emergency room is necessary for severe problems like broken bones or heart attacks. But some research shows that ER visits aren't necessarily good indicators of overall health. Moreover, One study found that only 7 percent of ER visits resulted in hospitalization. Another study showed that nearly half of all ER visits are for colds and flu. Some people also visit the ER simply because they want to see a specialist rather than waiting until the problem becomes severe.
5. Doctors Don't Want To Treat Patients Who Aren't Insured
Doctors who work in a public setting often prefer to treat patients with insurance since it makes their jobs easier. However, you probably won't get seen if you go without insurance. According to one survey, less than 15% of uninsured people visited a physician's office.
The Affordable Care Act requires insurers to spend at least 80 cents of every premium dollar on actual care. Insurance companies argue that these costs prevent them from lowering premiums, but critics say that the regulations increase costs. Many hospitals now refuse to treat uninsured patients.
You may have heard about free mammograms, colonoscopies, flu shots, etc. Private companies generally offer these services, not the government, so there's no obligation to sign up. There are plenty of reasons why you might choose not to do so. For instance, many states require women over 50 to pay extra for annual physical exams, even if they've had a regular checkup within the last year.
Some hospitals charge exorbitant rates for routine operations, which can be challenging for consumers to absorb. One study found that the cost of an appendectomy ranged from $1,715 in rural areas to $9,834 in metropolitan areas.
Insurance companies sometimes charge high fees to customers, despite paying little or nothing to providers. These charges include co-pays, deductibles, coinsurance, and other out-of-pocket expenses. They're ubiquitous when applying for new policies.
One proposal would allow people under 30 to stay on their parent's plans until age 26. Under this plan, young adults could keep their current insurance plan until they turn 26 years old. However, they'd then need to buy coverage elsewhere.
Another idea would allow individuals to maintain their original policy for two years after college. After that, they'd need to purchase another plan, similar to how most employers offer group insurance.
Other ideas include:
• Requiring everyone to carry insurance.
• Making sure that insurance doesn't discriminate against pre-existing conditions.
• Preventing insurers from denying coverage due to preexisting conditions.
• Allowing children to remain on their parent's plans until they turn 18.
• Giving families more time to make medical decisions.
• Reducing paperwork and reducing the number of doctors who participate in Medicare Advantage Plans.
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