Many people who live in the US have monthly expenditures that occupy not only a lot of their money but time and energy too. One of these is credit card debt. If you’re dealing with debt, consider using the debt avalanche method to pay it off. Aside from that, many individuals and families cite healthcare costs as another main concern. With the cost of healthcare rising, it could become an even greater expense in 2022. We’ll discuss the reasons for this below.
Aging seniors are one reason why the average cost of healthcare may go up in 2022. But wait a minute, you might ask. If you’re not yet a senior yourself, why should your healthcare cost go up because of an aging population?
The older population continues to drive national health spending, the reason being, people are living longer. Federal health spending is estimated to account for close to 20% of the gross domestic product by 2027.
By 2060, Americans eligible for Medicare will make up almost one-quarter of the population. This means more growth in Medicare enrollment, with rising costs necessary to adequately fund the program.
Even if you’re not old enough to use Medicare yet, with each passing year, you’ll need to put more into it for it to remain viable. That means you’ll pay more in taxes to fund America’s healthcare, even if you’re not able to take direct advantage of it for decades to come.
An Increase in Chronic Diseases
Chronic disease will likely play a part in healthcare costs going up in 2022. Six out of ten adults in the US now have chronic illnesses, such as diabetes, cancer, or heart disease. There are also mood disorders to think about, such as depression and anxiety.
You may have one of these conditions, or you might not. However, even if you’re not personally afflicted, their increased prevalence is driving up the average cost of healthcare.
There remains a strong link between the cost of caring for chronic diseases and overall healthcare prices. This healthcare spending goes toward outpatient treatments, emergency care, routine office visits, and prescriptions.
Rising Drug Prices
Rising drug prices are yet another reason why you may have to spend more on healthcare in 2022 than you did in 2021. The per capita cost of prescription drugs for the average American is higher than in many other developed countries, and it keeps climbing with each passing year.
Drug manufacturers can use a pricing structure based on a product’s “estimated value.” This means that a pharmaceutical conglomerate can legally raise a drug’s list value as they see fit, with very little regulation.
In 2020, President Trump signed an order that would allow Medicare beneficiaries to take advantage of lower prescription drug costs. This executive action would put a new payment model for Medicare Parts B and D drugs in place. The cost would never exceed what drug manufacturers charge users in other developed countries.
However, this order is facing months of quibbling and federal rulemaking. For the moment, it has little effect.
Many Individuals Could See Higher Medical Costs in 2022
In addition to the factors we mentioned above, healthcare service prices are going up, as are administrative costs. Considering all of that, many individuals and families are likely to see more costly healthcare plans next year.
Your best bet to try and counteract this issue is to find a job with an excellent medical plan. If you’re self-employed, you can look into subsidies through the marketplace provided by the Affordable Care Act in your state.