What enters a river upstream almost always flows downstream. It’s important to think of your health insurance premium this way. Your premiums lie downstream and reflect the prices charged by hospitals, physicians, drug companies and the cost of technology and administration upstream in the system.
The more that this expensive system is used, the more pressure there is on health insurance costs downstream.
The fact is — the use of our expensive health care system is surging. An increasingly unhealthy and aging population is putting intense pressure on it. The rate of chronic conditions like diabetes, heart disease and obesity has increased exponentially, leading to more hospitalizations, specialist visits and long-term pharmaceutical and medical treatments. These surging demands are putting immense pressure on health insurance affordability.
The Impact on Health Care Affordability
Higher Utilization Drives Higher Insurance Costs. People using more and more services in the system means higher overall medical spending — costs that eventually flow into their health insurance premiums and out-of-pocket expenses.
More Complex Care = More Expensive Care. Managing multiple chronic conditions often calls for frequent specialist visits, rising use of new prescription drugs and long-term treatments.
More Care in High-Cost Settings. Many people — especially those with unmanaged chronic conditions — end up in the emergency room or admitted to hospitals for preventable issues, driving up system-wide costs.
What Is Blue Cross Doing?
Partnering with Providers to Invest in Value-Based Care. Programs like Blueprint for Affordability and Value Partnerships ensure Michigan providers are paid appropriately for keeping people healthier. These models move us away from the antiquated "fee-for-service” model — which drives more use of expensive care. Instead, we are focusing payment on what people really want — better health, preventive care, better chronic disease management and fewer long stays in the hospital.
Strengthening Preventive and Coordinated Care. Through initiatives like Patient-Centered Medical Home, we’re making it easier for people to get the right care at the right time — before conditions worsen. This helps patients stay on top of chronic conditions, better managing their health, thus improving their lives and reducing emergency room visits and expensive hospitalizations.
Advocating for System-Wide Change. The affordability crisis won’t be solved by insurers alone. We need hospitals, drug companies and policymakers to step up, too. Everyone in the system must work together to address the rising costs of care, drug pricing transparency and the outdated ways we pay for health care.
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