Health insurance premiums are climbing because the underlying price of care is climbing, not because Americans are using more care, according to a STAT investigation. The outlet analyzed federal and industry data and spoke with more than 20 health policy experts, industry executives, and benefits professionals for its Out of Pocket, Out of Reach series. The conclusion: hospitals, drugmakers, and other parts of the health care industry charge prices that are both high and largely hidden from the employers and workers who pay the bills.
Insurers do not set premiums in a vacuum; they pass along the cost of care. STAT found that the biggest factor in that cost is not how often people visit hospitals or doctors' offices, but the out-of-control price tags attached to services and products. Employers and employees are often powerless to stop those charges, the investigation reported, leaving businesses and workers drowning in premiums they cannot effectively push back on.
Johns Hopkins professor Gerard Anderson, who helped design Medicare's hospital payment system in the 1980s, co-authored papers in 2003 and 2019 that identified the same culprit behind America's outlier health spending: "It's the prices, stupid." Anderson told STAT that some things don't change.