The increase is attributed inflation, prescription drugs, and behavioral health utilization.
Healthcare costs are predicted to reach a 13-year high in 2025, according to a report by consulting firm PwC.
According to the report, an 8% year-over-year increase is expected for the group health insurance market, along with a 7.5% increase for the individual market. PwC attributes the increases to inflation, prescription drugs, and behavioral health utilization.
This is unwelcome news, coming so soon after the release of the Centers for Medicaid and Medicare Services’ proposed 2025 Physician Fee Schedule. If finalized as is, physician reimbursement will be lowered by 2.8%, despite earlier predictions of practice costs increasing by 3.6% in 2025.
Additionally, provider billing practices will also face increased scrutiny, as the proposed rule aims to combat suspicious billing practices within Medicare’s Shared Savings Program.
Revenue and financial leaders have been prioritizing financial stability for the last few years, seemingly to no avail. If it isn’t inflation, it’s workforce issues, uncooperative payers, low reimbursement, or a storm of all of the above fraying system’s budgets.
Providers have long been vocal about the need for reimbursement to keep pace with inflation, or at least cover the cost of care.
Revenue cycle technology has been a popular option for many systems and individual practices looking to save money. Whether the goal is to improve efficiency or automate redundant tasks, the investment enables staff to work on more complex tasks—although the return on investment may vary.
Other leaders have seen success focusing on payers with meticulous and persistent appeals efforts for denials.
Jasmyne Ray is the revenue cycle editor at HealthLeaders.
KEY TAKEAWAYS
It was previously predicted that practice costs would increse by 3%.
Financial stability remains a priority, yet issues with workforce, payers, and low reimbursement are straining budgets.