Study links soaring health care spending to higher insurance premiums
Growth in health care spending in the United States is driving increases in health insurance premiums, limiting people's access to care and contributing to wage reductions, job losses and rising inequality, according to a new study co-authored by Yale economist Zack Cooper.
A recent study co-authored by Yale economist Zack Cooper reveals that the rapid growth in U.S. health care spending is directly responsible for soaring health insurance premiums, which in turn are limiting access to care and contributing to wage reductions and widening inequality. The research, published in the journal JAMA Health Forum, analyzed state-level data on insurance premiums, health spending, and insurer markups from 2011 to 2024 and found that 91% of the growth in premiums during this period was driven by rising health care spending, while insurer markups decreased from around 19% to 15%.
This suggests that efforts to curb the high cost of insurance premiums should focus on making health care spending more affordable. The average private health insurance premium rose 78% from $4,008 in 2011 to $7,151 in 2024, while health spending increased by 84%. Health insurance premiums are now, on average, 78% higher than in 2011, with some states experiencing even greater increases.
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