Login on site

×
Login on site
logo
Capital Services
logo
  • Services
    • HR Consulting
    • Employee Benefits
    • Business Planning
    • Individual Coverage
    • Personal Planning
    • Wellness Planning
    • Compliance
    • Millennial Workforce Solutions
    • Recruiting
  • Who We Serve
    • Individuals
    • Employers
    • Mergers & Acquisitions
    • Human Capital
  • Culture
  • Approach
  • Blog
  • Careers
  • Quick Links
    • CSI Client Portal
    • Employee Benefits Portal
    • Individual Coverages
    • Carrier/TPA
  • Schedule a Call
July 13, 2023 by Capital Services in Business

Healthcare costs are expected to grow 7% in 2024 due to rising pharmaceutical expenses driven by specialty drugs and insurers increasing rates in response to inflation, according to an annual report from professional services firm PricewaterhouseCoopers (PwC). This trend is higher than 2022’s and 2023’s projected medical cost rates, which were 5.5% and 6%, respectively. The report surveyed U.S. health plans covering 100 million group members and 10 million Affordable Care Act marketplace members.

High-cost medications, drug shortages and supply chain disruptions are driving healthcare costs upward. For example, new cell and gene therapies, many of which have recently been approved by the U.S. Food and Drug Administration, and heightened demand for expensive GLP-1 diabetes and obesity drugs are drivers of medical cost trends heading into 2024 and beyond.

While inflation impacted the U.S. economy in 2022, it was not significant in the healthcare industry because prices tend to be locked in existing annual or multiyear provider contracts. However, providers continue to experience worker shortages and increased labor costs, causing them to seek higher reimbursement from payers to recoup financial losses. Additionally, increased healthcare utilization will likely impact health plans in 2024.

Despite the expected rise in health care costs, some trends are easing this pressure. Such trends include the expanded availability of biosimilar drugs and the transitioning of individuals from expensive inpatient hospital settings to affordable outpatient care. The following are other factors that will likely impact health care costs:

  • Value-based care investments
  • Behavioral health care utilization
  • Health equity initiatives
  • Price transparency rules
  • Impacts of COVID-19
  • Medicaid redeterminations

Monitoring these factors will be critical to aid employers in reducing their future medical costs.

What This Means

The PwC report highlights how tackling affordability and rising healthcare costs will continue to be top challenges for employers for the foreseeable future. Employers will need to find new strategies, rework existing business models and take advantage of transformational opportunities, including investing in innovation and technology, to lessen the impact of rising healthcare costs on their organizations. Understanding medical cost trends can help employers act now to protect themselves against increasing healthcare costs and better support their employees.

Written by: Pat Isaac, CEO of Capital Services, Inc.

For more information on CSI, Scan below!

0
Recommend
  • Facebook
  • Twitter
  • LinkedIN
  • Pinterest
Share
Tagged in

Categories

  • Business
  • Design
  • Employee Benefits
  • HR Consulting
  • Real life
  • Uncategorized

Archives

  • May 2025
  • April 2025
  • March 2025
  • February 2025
  • January 2025
  • August 2024
  • April 2024
  • February 2024
  • December 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • October 2019
  • June 2019
  • July 2016

We believe that passion for people builds innovative workplaces that have higher levels of performance, more engagement and satisfaction, and overall cost reduction in long term health-related expenditures.

Capital Services Incorporated BBB Business Review

Quick Links

  • CSI Client Portal
  • Employee Benefits Portal
  • Individual Coverages
  • Carrier/TPA

Contact Us

Corporate Headquarters

215 Washington Avenue
Suite 400
Towson MD 21204

443-608-5520

marketing@capital-services.com

© 2021 Capital Services. All rights reserved.
Terms and Conditions

logo

Please provide your name and email address and we will send you these resources right away.

  • This field is for validation purposes and should be left unchanged.

 

Username:
Password:

Client Portal Login


Username:
Password:
Retrieve your login information

Username:
Password:

Get your Guide to Creating a Hiring Process that Works now

  • This field is for validation purposes and should be left unchanged.

Client Portal Login


Username:
Password:
Retrieve your login information