Inflation Is Falling But Health Care Costs Aren’t

We’ve all felt the burden of inflation over the last few years and are slowly feeling relief as inflation drops. Unfortunately, the cost of health care is still on the rise—and is only expected to continue rising.

According to an analysis by PwC’s Health Research Institute, costs are expected to rise between 7% and 8% in 2025 and reach a 13-year high. Inflation rates are at 3%, down from 6.5% at the end of 2022.

 The report points to several factors that may be behind the increase, including costs of new and innovative prescription drugs including GLP-1s, drugs that treat Alzheimer’s or Parkinson’s disease, hospital expenses and the utilization and cost of behavioral health services.

“Today’s medical cost trend is an urgent call to action for health care organizations to rethink their strategies to manage the total cost of care more effectively…” the PwC analysts said.

Luckily, a few things are working to drive costs down. Those include biosimilar drugs, which Voices for Affordable Health has featured before. Biosimilar drugs are very similar in structure and function to biologic medicines, or medicines made in a living system like bacteria, human cells, and yeast. These drugs offer safe, affordable options for treating many chronic and severe conditions.

Are you concerned about health care costs continuing to climb? How will this affect you in the coming year?