Healthcare spending for individuals with FSAs and HSAs

In the U.S., health insurance premiums are tax deductible–if paid through out of pocket expenses–but out-of-pocket expenses are not. However, there are exceptions to this rule. These include two often-used tax-favored accounts: Flexible savings accounts (FSA). These accounts allow employees to set aside a portion of their pretax income to cover qualified medical expenses; however,…

Health care for workers

On this Labor Day, how is healthcare evolving for workers and firms? First, healthcare spending is on the rise, with costs increasing more than inflation. Fox Business reports on a new Aon study which says that: …employer health care expenditures are projected to surge 9% in 2025 to more than $16,000 per employee, markedly higher…

Impact of genericization on drug prices and treatment value across 8 countries

An interesting study from Miquel Serra-Burriel et al. (2024) examines the impact of genericization on drug prices across 8 high-income countries (Australia, Canada, France, Germany, Japan, Switzerland, UK, and US). The authors used 2011-2020 IQVIA MIDAS data across 505 novel originator drugs. They found that: Price decreases were statistically significant over the 8 years after…

Health and wealth

Are wealthier people healthier? If so, how strong is this relationship? Does it vary across countries? That is what a paper by Kyriopoulos et al. 2024 aims to answer. They measure health and wealth using a “concentration index” (CI) which is calculated as follows: CI is estimated with reference to the concentration curve, which illustrates…

FTC report on PBMs

Last week, the Federal Trade Commission (FTC) released a report titled “Pharmacy Benefit Managers: The Powerful Middlemen Inflating Drug Costs and Squeezing Main Street Pharmacies.” While I won’t get into an analysis of the specific arguments FTC made, the report does have a number of interesting statistics and graphics on pharmacy benefit managers (PBMs). Some…

Impact of Education on Mortality

It makes sense that more educated individuals have lower mortality rates. Better education may improve health literacy. More education can lead to higher income and and more employee health benefits (with better insurance coverage). However, does living in communities with more educated individuals impact mortality separately from whether an individual’s family is highly educated? According…

US Health Insurance Trends: 2024-2034

The Congressional Budget Office (CBO) recently released projections of US health insurance levels between 2024 and 2034. In the Hale et al. (2024) study, CBO estimates that: …92.3 percent of the US population, or 316 million people, have coverage in 2024, and 7.7 percent, or 26 million, are uninsured. The uninsured share of the population…

Time is money in drug development

Delays in drug approvals cost pharmaceutical firms money. These costs include both lost sales as well as additional cost if clinical trials need to span a longer duration. While these facts are not in doubt, a key question is how much do delays in approval cost firms? A paper by Smith, DiMasi and Getz (2024)…