What’s driving insurance premium increases? Hint: It’s not prescription drugs

New Avalere Health analysis finds prescription drugs are not the primary driver of insurance premium increases.

Allyson Funk
Allyson FunkAugust 2, 2016

What’s driving insurance premium increases? Hint: It’s not prescription drugs.

A new analysis from Avalere Health looks at 2017 proposed health insurance premium increases. As in 2016, insurers’ own data point to outpatient spending as the largest expected driver of premium increases in 2017. The key takeaway: Hospital spending – inpatient and outpatient – accounts for nearly half (45.3 percent) of projected rate increases.

“Preliminary data indicate that drugs are not likely to have a disproportionate impact on premiums in 2017,” Avalere said, highlighting that outpatient spending continues to drive premiums (representing 29.9 percent of increases).


Prescription drugs can be a part of the solution, providing unique value to patients by helping to lower provider and hospital spending when patients are able to successfully manage their conditions through medicines.

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