The “new normal” for healthcare won’t be easy on your wallet
Medical costs are reportedly entering a “new normal” after years of double-digit growth, according to this report from PwC’s Health Research Institute. Medical costs are now rising about 6% to 7% each year, a decrease from the double-digit percentages in the late 2000s. The PwC expects medical costs to increase 6% this year and 6.5% in 2018.
While this may sound like good news, it might affect American workers, since their wages and the consumer price index are increasing at a far slower rate. Since 2010, wages have grown by between 1% to 3.6% per year, according to the Social Security Administration. “It still costs too much,” said Barbara Gniewek, principal at PwC. The increases “impact employees because as employers make plan design changes, they pay more of a share of the cost.”
The medical cost trend is defined by PwC as the percentage increase in the cost to treat patients each year. It has been moderated by both the economy and structural changes, as CBS reports. One major factor that led to the recent growth in health care costs is the pharmaceutical industry. Drugmakers are more cautious about increasing prices, now that the scrutiny on drug pricing from consumers and lawmakers is higher.
loading...
“In a highly concentrated market—the top 10 pharmaceutical companies based on U.S. sales made up 53 percent of the U.S. market in 2016—a few mentions on social media could have a devastating effect,” the report said.
Loading...