CMS Actuaries: U.S. Healthcare Spending to Reach $7.2 Trillion by 2031

By Mark Hagland - The actuaries at the Centers for Medicare and Medicaid Services (CMS) on Wednesday, June 14 released their projections for overall U.S. national healthcare spending for the next several years, finding that total national health spending will reach $7.2 trillion by 2031 and grow from the 18.3 percent of gross domestic product (GDP) that it was in 2018, to 19.6 percent by 2031. That $7.2-trillion figure would represent a staggering 63.64-percent increase in expenditures over the actuaries’ 2022 estimate shared on Wednesday. Read Full Article…

VBA Article Summary

1. National Health Spending Projections: The Centers for Medicare & Medicaid Services (CMS) released projections for national health spending. The estimates indicate that health spending will grow by 4.3 percent in 2022, reaching a total of $4.4 trillion. Over the period of 2022-2031, health spending is expected to grow by an average of 5.4 percent per year.

2. Impact on Health Insurance Enrollment: The projections suggest that the insured percentage of the population will reach a historic high of 92.3 percent in 2022, mainly due to increased Medicaid enrollment and gains in Marketplace coverage. However, with the expiration of the Medicaid continuous enrollment condition in 2023, Medicaid enrollment is expected to decrease, resulting in a net loss of 8 million beneficiaries in 2024. If certain provisions from the Affordable Care Act expire by the end of 2025, the insured share of the population is projected to be 91.2 percent. By 2031, the insured share is expected to be 90.5 percent, similar to pre-pandemic levels.

3. Expenditure Projections for Different Programs: The projections indicate that Medicare will experience average annual expenditure growth of 7.5 percent over the period of 2022-2031. Medicaid expenditures are projected to grow by 5.0 percent on average, with a decline in enrollment expected between 2023 and 2025. Private health insurance spending is estimated to grow by an average of 5.4 percent. Additionally, the article highlights trends in hospital spending, physician and clinical services spending, and the expected impact of the Inflation Reduction Act on Medicare Part D enrollees.

Healthcare's affordability problem is about to get worse

By Jakob Emerson & Molly Gamble - Healthcare's current-day reality and the financing behind it are like a TV with lip sync problems. As you watch healthcare events and disruptions unfold, their effects on pocketbooks are delayed. 2022 was a bad year for hospital and health system finances. Read Full Article…

VBA Article Summary

1. The financial situation for healthcare is deteriorating, as seen by the events of 2022 when approximately half of U.S. hospitals finished the year with a negative operating margin. Factors such as labor expenses, global supply chain problems, and inflation have intensified these financial difficulties by increasing supply, capital, and drug expenses​¹​.

2. Inflation, which has been a significant issue in the U.S. since 2021 and reached a 40-year high in 2022, is likely to start affecting healthcare costs. Despite the initial impact on consumers being more prominent than on healthcare costs, the ripple effects of inflation are expected to catch up and be increasingly felt by healthcare consumers​¹​

3. Despite the common trend of consumer inflation rates being slower than inflation for medical services, 2022 and 2023 saw the opposite. During this period, prices for all goods and services grew by 6 percent, while prices for medical services increased by only 2.3 percent. The impact of inflated prices for goods and services on consumer behavior, including in healthcare, has been significant, with the number of people delaying or forgoing medical treatment due to cost reaching a 22-year high in summer 2022​¹​.

UnitedHealth expects higher medical costs in Q2 as delayed care makes comeback

By Rebecca Pifer - The early days of COVID saw widespread halts in nonessential services, causing visits to plunge with an estimated one-third of U.S. adults delaying or foregoing medical care in the pandemic’s first year. By 2022, the sizable rebound in deferred care that many predicted had yet to materialize. Instead, patient volumes increased, but didn’t return to normal levels, threatening the financial health of hospitals, which rely on utilization for revenue. However, the trend helped payers, which reaped some of their highest profits in history during the pandemic on low medical spend. Read Full Article… 

VBA Article Summary

1. UnitedHealth, the parent company of the largest private payer in the U.S., expects higher medical costs in Q2 2023. This is due to the pent-up demand for delayed healthcare during the COVID-19 pandemic and a surge in outpatient care utilization, particularly among seniors. The company's medical loss ratio, which is the share of premiums spent on members' healthcare costs, is expected to be higher than previously anticipated​¹​.

2. The normalization of medical activity after COVID-19, marked by the dropping of mask mandates and seniors becoming more comfortable accessing services for things they might have postponed, such as knee and hip procedures, is contributing to the increase in the medical loss ratio. UnitedHealth has observed strong outpatient demand through April, May, and June, especially for hip and knee procedures at their own ambulatory surgical centers and within their Medicare business​¹​.

3. The increase in medical costs has impacted UnitedHealth's stock, which dropped 7% in the wake of this news. Other Medicare-focused health insurers were also affected. Furthermore, UnitedHealth doesn't anticipate this heightened activity to subside soon. Consequently, they incorporated higher outpatient utilization into their Medicare Advantage plan bids for 2024, highlighting the longer duration of this trend​¹​.​.

Discover the Top 10 Digital Health Trends in 2023

By StartUs Insights - How are healthcare institutions digitizing care delivery to improve access to healthcare and patient outcomes? This data-driven industry research focuses on digital health startups & scaleups as well as their technology solutions. They include digital therapeutics and biomarkers, remote patient monitoring, cloud-based healthcare, & more. Read Full Article…

VBA Article Summary

1. Healthcare Analytics: The healthcare industry generates a vast amount of data from various sources like EHRs, medical imaging, wearables, and mobile health apps. Analyzing this data improves the overall efficiency of healthcare systems. Healthcare analytics provides clinicians with real-time data for informed decision-making on disease diagnosis. Machine learning algorithms are used to identify patterns in large datasets for predictive analytics, which can identify patients at risk of developing conditions like diabetes or heart disease. This allows for early intervention. Furthermore, healthcare analytics can help hospitals optimize operations, such as appointment scheduling, staff management, and resource allocation​¹​.

2. Cloud Healthcare: Cloud computing in healthcare allows clinicians and medical staff to manage large volumes of patient data, such as EHRs or medical imaging data, more efficiently without the need for expensive infrastructure. It provides easy access to patient healthcare information whenever needed and enhances the speed and efficiency of care. Cloud computing also ensures a secure backup for healthcare data in emergencies, preventing loss or destruction of critical patient data. It facilitates the delivery of telemedicine services, thereby improving care access for patients in remote areas​¹​.

3. Electronic Health Records (EHRs): EHRs have evolved significantly over the years, focusing on improving the accuracy, accessibility, and usability of patient data. They provide healthcare professionals with real-time access to a patient’s complete medical history, thus improving the diagnosis, treatment, and monitoring of health conditions. Advances in EHR are focused on improving interoperability, making it easier for healthcare providers to access and share patient data across different systems. AI algorithms are being incorporated into EHR solutions for more accurate diagnosis and treatment recommendations. Voice recognition-powered EHR systems, which use natural language processing (NLP), save time and reduce the risk of errors associated with manual data entry​¹​.

At Least 1.7M Americans Use Health Sharing Arrangements, Despite Lack of Protections

By Markian Hawryluk - A new report has provided the first national count of Americans who rely on health care sharing plans — arrangements through which people agree to pay one another’s medical bills — and the number is higher than previously realized. The report from the Colorado Division of Insurance found that more than 1.7 million Americans rely on sharing plans and that many of the plans require members to ask for charity care before submitting their bills. Read Full Article… 

VBA Article Summary

1. The total membership numbers of health sharing plans in the United States are likely higher than previously reported. The state agency collected data from 16 sharing plans but identified five others that did not report their data. This finding has raised concerns about the coverage and consumer protections offered by these plans

2. Health sharing plans operate under arrangements where members, who often share religious beliefs, agree to contribute money each month to cover other members' healthcare costs. However, these plans do not guarantee payment for health services and are not held to the same standards and consumer protections as traditional health insurance plans. They may not cover preexisting conditions, provide minimum health benefits mandated by the Affordable Care Act, or have limits on payments.

3. In Colorado, at least 67,000 people were members of sharing plans in 2021, representing approximately 25% of Coloradans purchasing health care coverage. The state's Division of Insurance has received complaints from sharing plan enrollees who were unaware of the limitations and risks associated with these plans. Additionally, health sharing arrangements often require members to seek charity care or assistance before submitting sharing requests, which shifts costs to other public or private health plans.

NEW Employee Benefits Continuing Education Series for Risk & Insurance Professionals

By The National Alliance for Insurance Education & Research - The National Alliance for Insurance Education & Research is proud to announce the launch of a new seven-part Introduction to Employee Benefits continuing education series for risk and insurance professionals. The Introduction to Employee Benefits series covers a range of topics including the history and evolution of employee benefits, group health insurance fundamentals, health insurance legislation, common policy exclusions and quoting. The series also covers the Patient Protection and Affordable Care Act, group disability income insurance, voluntary benefit programs, and how to work effectively with group insurance contracts, insurance companies, and employers. Read Full Article… 

VBA Article Summary

1. The National Alliance for Insurance Education & Research has launched a new transformative learning subscription service called the Essential Online Subscription. This service is designed to help insurance professionals earn quality continuing education (CE) credits and expedite new employee onboarding processes. The subscription provides 24/7 year-long access to introductory risk and insurance courses, ACORD forms training, and monthly one-hour webinars on current and emerging industry topics​¹​.

2. The Essential Online Subscription includes more than 30 risk and insurance courses, offering significant educational value at a low cost. Subscribers can learn at their own pace with a year-long access to these self-paced courses. In addition, the subscription includes a year-long Academy membership that provides access to research, newsletters, and podcasts. The service is ideal for licensed professionals seeking quick, high-quality CE, and for agency managers requiring support with employee onboarding processes​¹​.

3. The Essential Online Subscription also allows insurance professionals to fulfill their licensing requirements and improve their professional credibility by learning from one of the most rigorous risk and insurance education institutions in the industry. The National Alliance plans to continue developing innovations like this subscription service to help professionals achieve their career goals efficiently and in record time​¹​.

KFF Survey Shows Complexity, Red Tape, Denials, Confusion Rivals Affordability as a Problem for Insured Consumers, With Some Saying It Caused Them to Go Without or Delay Care

By KFF - Most Consumers Across Types of Insurance Had a Problem with Their Coverage in the Past Year, Including About Three-Quarters of Those Who Used a Lot of Care or Received Mental Health Services. Most (58%) people with health insurance say they encountered at least one problem using their coverage in the past year, with even larger shares of people with the greatest health care needs reporting such problems, finds a new KFF survey of consumer experiences with health insurance. Read Full Article…

VBA Article Summary

1. Majority Experience Insurance Problems: The survey indicates that 58% of insured individuals faced at least one issue with their coverage in the previous year. Problems varied across insurance types and included denied claims, difficulty finding in-network doctors, and delays and denials of care that involved an insurer’s prior authorization. At least half of the participants from four major types of health coverage - employer, Medicaid, the Affordable Care Act’s marketplace, and Medicare - reported a problem with their coverage​¹​.

2. Insurance Complexity and Affordability: The complexity of insurance is as big a problem as affordability, particularly for those with greater healthcare needs. People reported challenges with denied claims, limited in-network providers, and a labyrinth of red tape, with many stating that these issues prevented them from receiving necessary care. More than a quarter (28%) of respondents who reported problems stated that they had to pay more for their care as a result​¹​.

3. Impacts of Insurance Problems: Insurance problems can impact the ability of insured individuals to get timely, necessary care. About 17% of respondents who recently experienced insurance problems said they were not able to get recommended care, faced a significant delay in receiving care, or their health declined as a direct result. The survey also highlighted that insured individuals who rate their mental health as fair or poor encounter more challenges, with 44% of them stating they couldn’t afford the cost of mental health care and more than a third saying it was because their insurance wouldn’t cover it​¹