Health care cost projected to rise 9%. Competition, not regulation, might be the cure. | Opinion

If you are like the majority of Americans who are covered by an employer-sponsored health insurance plan, you may be preparing to sift through the pile of paperwork that arrives with the start of your health insurance open enrollment period.

If you are a business owner or human resources professional in charge of making decisions about the benefits you offer your employees, you may already be considering the coverage options for your health insurance plan.

Either way, you might want to hold on to your wallet.

According to professional services firm Aon, “The average cost of employer-sponsored health care coverage in the U.S. is expected to increase 9.0 percent, surpassing $16,000 per employee in 2025.”

Some costs go up as inflation rises, with the cost of wages and supplies used for medical care going up like about everything else these days. Unfortunately, even as overall inflation cools, this forecast health care cost increase would be even higher than last year’s cost hike. This will put more pressure on the bottom lines of employers and families just as relief was in sight in other parts of the economy.

This may feel like a same-song-second-verse situation, seeing as how you’ve lived through past health care cost increases around this time of year seemingly every year. Perhaps you have already resorted to setting the bar low and preparing for disappointment.

Employers can, and often do, dedicate more dollars to protect their employees from price hikes, but that is only sustainable for so long. Can we somehow change course toward a better future for health care affordability?

Some would have you believe that the way forward is through new government regulations on employer-sponsored health plans.

Whether it’s mandating additional coverage, imposing price controls on medications, eliminating health plan networks, requiring certain levels of reimbursement for various service providers, stringing up additional red tape on pharmacy benefit managers, known as PBMs, banning incentives to shop at cheaper providers, or restricting mail-order prescription drugs, these “solutions” from the government only serve to drive up costs and limit options for employers and employees.

So how can we escape from this quagmire of ever-increasing costs for health care?

As the saying goes, when you’re in a hole, stop digging.

That is to say, how about we not do all of those things?

More regulation usually brings unintended consequences, and almost always raises costs on businesses and consumers.

Case in point: Congress is considering additional mandates on PBMs that could stifle the very competition that helps to keep prices in check.

By imposing new layers of regulation, the government risks creating an environment where PBMs, on behalf of employers, can no longer effectively negotiate rebates from drug manufacturers, manage high-cost specialty medications, or employ cost-control mechanisms to ensure that patients receive the most appropriate and economical treatments. This will ultimately lead to higher prices for all of us.

Additional regulatory burdens will not help Kansans manage rising health care costs, and we shouldn’t sit idly by while budget-busting proposals meander their way through the halls of Congress or the Kansas Statehouse. Let’s stand up with our fellow Kansans to tell our elected officials that we can’t afford any more anti-competitive legislation that raises the cost of health care for Kansas businesses, employees, and their families.

Instead, we should take a hard look at the actual cost of providing health care as a good next step. Employers can help by seeking out innovative partners to negotiate better deals for prescription drugs, encouraging best practices that lead to better health outcomes, and linking arms with networks of cost-conscious providers that deliver quality services in an efficient manner.

By embracing free market principles and resisting the push for more government intervention, we can create a more efficient health care system. Let’s work together to keep health care costs down and maintain the high-quality and accessible care that Kansas employers and employees need.

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