TL/DR –
In 2022, about two-thirds of Nevadans faced affordability challenges in healthcare, including not having health insurance, struggling to pay medical bills, and delaying medical visits. Despite people’s struggles, Nevada’s healthcare industry was thriving, with health insurance companies and hospitals seeing profit margins upward of 15%. The state’s largest private health insurance firms, UnitedHealth Group, Centene, and Anthem Blue Cross Blue Shield, were highly profitable, with UnitedHealth Group earning $28.4 billion in national profits in 2022, a 19% increase from 2021.
High Healthcare Costs in Nevada: Residents Face Affordability Burdens Amid Profitable Health Industry
In 2022, health care costs continue to burden over two-thirds of Nevadans, resulting in challenges such as lack of insurance, unpaid medical bills and deferred medical visits for dental, addiction and mental health treatment. Despite this, a recent analysis shows a flourishing health care industry in 2022.
Health care premiums in Nevada have risen faster than the cost of covered insurance claims, leading to a spike in profits for health insurance companies. The Nevada Department of Insurance has control over rates for small group and individual insurance plans but does not govern hospital and provider rates.
Nevada hospitals practiced effective revenue management, as patient revenues surpassed operational expenses, according to the same analysis by United States of Care. However, this profitability does not translate to improved care with Nevada ranking 41st in overall health system performance and last in prevention and treatment.
Nevada’s top private insurance companies, including UnitedHealth Group, Centene, and Anthem Blue Cross Blue Shield, have seen profit margins exceeding 15%. UnitedHealth Group recorded a national profit of $28.4 billion in 2022, marking a 19% increase from 2021.
These companies also offer Medicare Advantage plans to 900,000 Nevadans and provide coverage to a large portion of the 46% of Nevadans with employer insurance. However, the companies failed to provide comment on these statistics.
Nevada’s hospital industry is notably more privatized compared to the rest of the country. With 55.3% of for-profit hospitals, the state ranks 13th in the nation, as per the same analysis. This privatisation could be a contributory factor to the state’s high healthcare costs.
For instance, Sunrise Hospital and Medical Center, owned by the largest for-profit health system in the US, charges patients 12.9 times the actual cost of care, making it the second highest in the country for average bill mark-up rate.
Rising healthcare costs have impact beyond the medical realm, contributing to increased car insurance premiums and escalating healthcare debt. This financial strain forces Nevadans to cut back on household spending, deplete savings, delay higher education or homeownership, or alter living conditions.
To address the healthcare affordability crisis, Nevada has initiated state-level measures such as decreasing prescription drug prices and creating a healthcare growth benchmark via the Patient Protection Commission. Plans for a public health insurance program offering more affordable coverage are also underway, albeit with priority given to reinsurance program funding for insurance companies.
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