Let’s face it: Health insurance can be a dry and complicated business. And it’s not easy deciphering the various concepts, jargon, and not-exactly-household words that define the business of insuring your health.
But your health insurance is important. And with health care reform, ever-rising costs for care and other trends that are transforming the industry, it’s a good idea to keep yourself abreast of what the changes mean to you.
That’s why we’ve put together this guide to help you understand what’s happening in health insurance, why it’s happening and what it means for you.
My health care costs are going through the roof. What gives?
Overall health care spending is indeed rising – to $2.5 trillion in 2009 or 17.3 percent of the economy, according to the Centers for Medicare and Medicaid Services. It’s projected to balloon to $4.5 trillion by 2019, or more than 19 percent of Gross Domestic Product.
Many factors are driving up benefit costs. In general, pricing is based on increasing demand for health care and the ready supply of providers able to meet the demand.
Demand is rising in part because of changing population demographics and treatment options. The
In fact, almost half of all health care spending is used to treat just 5 percent of the population.
On the supply side, health care manufacturers and other suppliers constantly invest in research and development, and providers continuously invest in new technologies to improve their capabilities for treatment. All of these expenses are passed along to the consumer and result in higher costs for care.
Lastly, salaries for health care professionals are competitive and may be higher in regions where, for example, registered nurses are in short supply. Hospitals in