Healthcare Costs are Skyrocketing

As the price of health care continues to rise, people seem to be skipping physician visits due to the phobia of the bill they may receive after. The National Business Group on Health said on Tuesday, that health care costs per employee are projected to increase by 5% to $14,800 in 2019. That is nearly $15,000 per worker and now corporate America has begun looking to “disruptors” such as Amazon for help, according to a new survey of the nation’s largest employers.

“Health care cost increases continue to outpace workers’ earnings and increases in inflation, making this trend unaffordable and unsustainable over the long term,” said Brian Marcotte, President and CEO of the National Business Group on Health, “No longer able to rely on traditional cost-sharing techniques to manage costs, a growing number of employers are taking an activist role in shaking up how care is delivered and paid for.”

Premiums and out-of-pocket costs for employees and dependents are also forecasted to increase. Although employers usually cover roughly 70% of these costs, employees are still left with about 30% of the bill or an average of $4,500 based on results from the National Business Group on Health 2019 large employer health care strategy and plan design survey.

The never-ending rise in health costs, now at more than two times the rate of general inflation, has led to much frustration from employers. They are now beginning to explore options outside of the traditional healthcare industry for relief. This is where employers are now looking to the technology community such as Amazon for help with health costs.

President and CEO of National Business Group on Health, Brian Marcotte, said, “Seven in 10 employers believe new market entrants from outside the healthcare industry are needed to disrupt healthcare in a positive way.” Although he did not mention any companies, in particular, he did continue to say, “disruptors include innovators from Silicon Valley and elsewhere, and employer coalitions.”

Earlier this year a few popular technology companies such as Jeff Bezos’ Amazon, Warren Buffet’s Berkshire Hathaway, and JPMorgan Chase & Company have all announced that they want to create an ‘independent company’ to help improve health care while lowering costs for their employees. Currently, it is unclear how the three companies plan on achieving better health care with lower costs to employees, but the National Business Group on Health has noted from their survey that other employers are looking increasingly at a variety of options.

“A growing number of employers are taking an activist role in shaking up how care is delivered and paid for,” Marcotte said. Looking at the survey provided by NBGH, 43% of employers believe artificial intelligence will have a future role in how healthcare is delivered and the other 52% believe “virtual care” will have a significant role in how healthcare will be delivered in the future.

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