Why does health insurance cost so much?
Why does health insurance cost so much? Year after year, many of the articles that appear in print detail the specific factors that drive the cost of health care.
These factors include: general inflation, advances in drugs and other medical devices, rising hospital and medical expenses, government mandates, increased consumer demand, litigation, fraud, and cost shifting .
The basic answer is that there is no magic bullet to solve the cost of insurance because the real difficulty is controlling the cost of health care. One simple way to dramatically reduce healthcare dollars spent is to reduce the demand for healthcare.
I have seen estimates that up to 40% of all health care related expenses result from preventable conditions. These preventable conditions are caused by lifestyle choices such as smoking, obesity, stress, lack of exercise, and poor diet.
Most of us, myself included, make lifestyle choices every day that eventually increase our demand for healthcare. We will never be able to completely eliminate all lifestyle-related healthcare costs. However, better lifestyle choices would cause a drastic reduction in demand. This would result in a similar reduction in healthcare dollars spent.
Less demand for health care would result in lower health insurance costs, higher productivity, and less absenteeism. If your organization has not already done so, your organizational leaders should seriously consider the benefits of health promotion and disease prevention programs. Your ROI will most likely be as high as 2:1 in the first year.
