The consequences of high healthcare costs

Healthcare is only getting more expensive. And while self-insured employers are feeling that burden, employees certainly aren’t immune from the stress of rising healthcare costs. Over the past 10 years:

• Employer-sponsored insurance premiums have grown at a rate exceeding both inflation and wage growth
• The average deductible amount has increased 53%

It’s becoming increasingly difficult for Americans to afford the bills associated with getting care—and when 73% of Americans rank their finances as the top stressor in their life, this skyrocketing cost of healthcare is sending their stress levels into the stratosphere. Research shows that concern is justified, as high healthcare costs negatively impact employees financially, mentally, and even physically.

Four ways high healthcare costs hurt employees

It makes sense that rising healthcare costs would be hard on employees’ wallets. But let’s dig deeper into the multifaceted ways escalating health expenses are hurting employees.

1. High healthcare costs affect short- and long-term health outcomes

When employees feel they can’t afford care, they’re more likely to skip it entirely.

According to 2022 research from Gallup, 38% of Americans said they or a family member had postponed medical treatment because of the cost. That’s an all-time high in the 22 years Gallup has monitored this trend.

In a separate survey, 21% of respondents said they have skipped filling a prescription because of the cost.

Huge price tags are fueling a reluctance to seek medical care, with 22% of respondents in another survey saying an unexpected medical bill makes them never want to go to the doctor again.

Unfortunately, skipping or avoiding exams and treatments leads to a slew of short- and long-term health problems, such as missed diagnoses, untreated chronic conditions, and acute issues that only worsen over time. To make matters even worse, if and when care becomes unavoidable, it’s often more complex and costlier.

2. High healthcare costs lead to difficult financial decisions

You wouldn’t think that employed adults would need to choose between paying for their healthcare or paying their mortgage, but it’s a situation that a surprising number of workers find themselves in.

Nearly half of U.S. adults say it’s difficult to afford healthcare costs. In separate research, 27% of respondents reported problems paying medical bills, which forced them to take measures like:

• Cutting back on other spending
• Taking on more credit card debt
• Using up their savings
• Borrowing from friends or family
• Taking out loans
  

Unexpected medical bills and the cost of healthcare services top the list of people’s financial worries—even ahead of monthly utilities, food, mortgage payments, and childcare. And that means employees often need to make tough choices to afford the care they need.

Do you get the care you need or pay the electricity bill? Do you get the care you need and, as a result, miss a rent payment, risking eviction? Do you get the care you need or buy groceries for yourself and your family? Imagine having to make one (or more) of those decisions.

3. High healthcare costs increase employee stress

Money is a significant cause of stress in most people’s lives, and climbing healthcare costs are only making matters worse.

In a 2023 study, 52% of Americans who had health insurance at the time said paying medical bills had been stressful. And they’re not just talking about a low level of anxiety. In the same study, an alarming 92% of those respondents said the stress has affected their physical and mental health.

Stress is hard on the body and the mind. According to the Mayo Clinic, long-term activation of the stress response system increases the risk of health problems like:

• Anxiety
• Depression
• Digestive issues
• Headaches
• Muscle tension and pain
• Heart disease, heart attack, high blood pressure, and stroke
• Sleep issues
• Weight gain
• Memory and focus struggles

In the ultimate cruel twist of irony, people can’t or won’t pursue medical help for these increasing stress levels—and the related side effects—because the cost of care is simply too high.

4. High healthcare costs negatively impact employee performance

If you’ve ever tried to put your stress and worry aside and focus on the task at hand, you know how challenging it can be. That’s because stress causes your cortisol levels to spike, which negatively impacts your cognitive performance. In simpler terms: stress makes it tough to think clearly.

Additionally, employees who can’t afford care might skip treatments—like physical therapy or surgery—that could reduce or eliminate their pain. Their chronic pain can lead to increased workplace absenteeism which further hinders their job performance.

So to recap:

• High healthcare costs lead to high stress levels, which prevents employees from functioning at their best
• High healthcare costs cause people to skip care, which means they have to continue dealing with pain that’s interfering with their ability to do their job

How Carrum helps employees get the best care without overwhelming financial stress

Learn more about Luis’ story with Carrum Health.

There’s no denying that surging healthcare costs are causing problems for employees. And understandably, you want your people to be able to get appropriate, high-quality care without undue financial strain.

That’s where a program like Carrum Health comes in. With our value-based approach, members get care through our curated centers of excellence network—we provide surgical care, cancer care, and more—and pay little to nothing for the high-quality care they receive. In fact, employees won’t receive a bill at all. Carrum takes care of the logistics so workers can focus on what matters most: their health.

High-quality, affordable healthcare should be an expectation, not a luxury. With a partner like Carrum Health, you can support your employees and ensure your healthcare offerings are truly a benefit—and never a burden.

The information contained on this page is for informational purposes only. No material is intended to be a substitute for professional medical advice, diagnosis, or treatment.