Rising Hospital and Drug Prices Drive Up Insurance Premiums for Workers and Employers

Bob Herman’s investigation, based on interviews with more than twenty health policy experts and industry leaders, finds that soaring hospital and pharmaceutical prices are the primary force behind rising health insurance premiums for both employees and businesses.

Insurers set premiums largely according to the cost of care, and the study shows that the dominant factor is not how often people visit doctors or hospitals, but the high, often opaque prices charged throughout the health‑care system.

The result is a growing financial burden on workers and employers alike, who have little leverage to curb these costs, underscoring a systemic pricing problem in American health care.