Healthcare costs continue to be a major concern across the globe, with a slight dip projected in 2024, offering a glimmer of hope. dacadoo, a digital health technology platform that puts the customer engagement at the centre of business, recently explored how digital health technology can help insurers become ‘affordability champions.’
According to WTW’s 2024 Global Medical Trends Survey, North America is expected to see a decrease in healthcare costs from 9.7% to 9.4%, while Europe might experience a decrease from 10.9% to 9.3%. However, the Asia Pacific region is anticipated to see no change, remaining at 9.9%. Despite these slight decreases, the long-term forecast still suggests an upward trajectory in healthcare expenses.
The burden of healthcare costs is becoming an increasingly urgent issue for individuals, families, and policymakers worldwide. Projections indicate that 58% of insurers expect to see higher or significantly higher medical trends in the next three years, highlighting the ongoing challenge of managing healthcare affordability.
Amidst this backdrop, a significant portion of Americans and people worldwide are concerned about the rising costs of essential medical services and treatments. A survey by KFF shows that an astonishing 73% of Americans are worried about healthcare costs, emphasizing the critical need for solutions to this pressing issue.
Understanding the healthcare cost crisis
The United States, despite its significant healthcare spending, often falls short in healthcare outcomes compared to other developed nations. Several factors contribute to this crisis, including high administrative expenses, skyrocketing pharmaceutical prices, the need for chronic disease management, an aging population, and defensive medicine practices. These factors collectively drive up the cost of healthcare, posing a challenge to the system’s sustainability.
Affordability challenge
The continuous rise in healthcare costs has made affordability a critical issue for many Americans. High deductibles, copayments, and premiums are putting a strain on household budgets, forcing some to skip necessary medical care or incur debt. Moreover, disparities in healthcare access further exacerbate the affordability crisis, particularly affecting marginalized communities and those with lower incomes.
The role of health insurers in addressing healthcare affordability
Health insurers are uniquely positioned to address the challenges of healthcare affordability by leveraging digital health technology. By focusing on prevention, early intervention, and improved health outcomes, insurers can help to reduce healthcare costs and enhance policyholders’ well-being. Strategies include personalized wellness programs, health monitoring devices, telehealth services, incentivized health behaviors, and health risk assessment tools. These initiatives can empower individuals to manage their health proactively, leading to cost savings and improved health outcomes.
Conclusion
The rising healthcare costs in the United States present significant challenges to affordability and access. However, by utilizing digital health technology, health insurers can play a crucial role in mitigating these challenges. Through the adoption of innovative solutions such as health monitoring devices, telemedicine, personalized wellness programs, and incentivized health behaviors, insurers can enhance the value proposition of their products. Embracing digital transformation will enable health insurers to lead the way in reshaping the future of healthcare, making it more affordable and accessible for all.
In the full article, dacadoo explores the rising healthcare costs, the affordability challenge, and how health insurers can play a pivotal role in addressing these issues through the adoption of digital health technology. Read the full story here.
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