Americans are feeling the squeeze of high prices across the economy — in both discretionary categories and core needs. Healthcare costs are a key concern, with rising provider prices as the greatest driver and this will likely remain so given the potential changes to Medicare, Medicaid and federal regulations of insurance markets.
Employers, which provide health insurance coverage to more than 60% of the working population (roughly 165 million people), have long been hesitant to act directly to impact these costs, lest they upset their employees. However, research from Public Agenda, with the support of Arnold Ventures, found that this fear is unfounded — people with employer-sponsored insurance want action to contain healthcare costs.
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People from all political perspectives believe the government needs to exert downward pressure on prices, but conversely, they are also skeptical that the government alone can be trusted to do so effectively. For that reason, they see a role for employers in pressing policymakers to act in the interest of their employees and the broader public.
Unsurprisingly, Public Agenda's study found that nearly nine in 10 respondents expressed concern about the prices hospitals, doctors and other medical providers charge for services. This unease outpaced worries about how much employers pay for employee health coverage, which was cited by about five in 10 respondents. And concerns about high healthcare costs are not just theoretical: one in five respondents reported incurring debt due to medical expenses in the past year, while 14% said they had to cut back on groceries and other household needs to afford healthcare.
The survey revealed that nearly two-thirds of respondents believe employer-based health insurance needs improvement. There is strong support for various policy measures to drive transparency and curb costs, including requiring medical providers to disclose prices and placing limits on how much providers can charge for services.
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This enthusiasm for regulation mirrors findings from an earlier survey of American voters who favored congressional action to lower hospital prices, as well as focus groups. However, despite strong support for reform, low levels of trust in government present a major hurdle. Only one-third of respondents trust government agencies to work toward making healthcare more affordable and just one-fifth trust elected officials to do the same. A key concern is that medical providers might exploit loopholes to avoid price regulations or exert pressure on policymakers to keep prices high.
This lack of trust raises a question: who else can step in? The research suggests employers themselves can serve as trustworthy champions of employee interests. In contrast to low levels of trust toward government, respondents expressed a higher level of trust in their employers to address healthcare affordability. While employers do not set policy, they're nonetheless tuned into the policymaking landscape and can use their leverage to push for better pricing practices.
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There is strong support for direct action: eight in 10 respondents back public advocacy by employers to fight against rising provider prices and collectively negotiate more reasonable costs. One approach to achieving this collective leverage is for employers, whether public or private, to work with their benefit brokers and advisers and regional coalitions, such as those affiliated with the National Alliance of Healthcare Purchaser Coalitions. By pooling resources and influence, members can better navigate through and negotiate within the complex insurance marketplace. This sort of networked strength also helps build a united front for messaging and goals for employers to work toward in healthcare pricing.
With national healthcare expenditures reaching an astronomical $4.5 trillion in 2022, the urgency for cost control is clear. Rising provider prices are a major factor driving these expenses and government intervention is necessary to rein them in. Employers have the opportunity to both advocate for this intervention and undertake their own strategies to ensure that healthcare becomes more affordable for all Americans.
— Dickson Su, Ph.D. also contributed to this piece
