Changes are transforming the U.S. health care market to the insurance coverage system. Employers are increasingly seeking to shift responsibility for health care costs to employees, that is direct consumers. In turn, this is causing a shift in the industry balance as not all consumers are willing to increase medical costs — as a result, health care employees are at risk of low budgets.
The declining cash flow situation in the health care sector is a pandemic problem for all stakeholders. In 2007, employees were required to cover 12% of their insurance plan, and by 2012 that number had risen to 34% (AHA, 2014). In this situation, consumers who are not willing to spend money on health care and health care providers who are getting less and less money for their work are increasingly vulnerable. The decision to spend finances creates a demand to develop new, transparent initiatives with tangible benefits for all parties.
One such solution is HDHPs, which have several benefits. First, this insurance program allows you to save money by paying a lower premium. Second, HDHPs allow the opening of individual medical savings accounts. Third, which is beneficial to health care providers, this plan forces patients to pay for each act of using health care services until the insurance plan takes effect. However, the need to pay for these services can lead to an increase in bad debt to providers, putting clinics at a disadvantage overall.
The insurance segment of the market, however, is broader. Because of employers’ natural reluctance to pay the cost of employee health care, the phenomenon of private exchanges is popularized. Agencies such as Towers Watson, Mercer, and Aon Hewitt, offer patients a wide range of insurance plans, up to twenty, for financial and health care interests. It is believed that one in four employers are looking to move to a private exchange system because it benefits each party and reduces administrative costs.
In conclusion, the insurance marketplace is changing, and insurance plans are gradually becoming more the responsibility of employees rather than employers. The discussed report from the AHA is a solid document summarizing reliable data and forming the correct conclusions. With this compelling report, critical trends in the U.S. insurance market become clear.
Reference
AHA. (2014). Increasing consumer choice in coverage and care: Implications for hospitals [PDF document]. Web.