Nevada’s health care industry faring well; health care consumers,  not so much 

Nearly two-thirds of Nevadans experienced health care affordability burdens in 2022, forgoing health insurance, struggling to pay medical bills, and delaying medical visits for dental care, addiction treatment, and mental health care. 

The health care industry was doing well in 2022 though, according to a recent analysis by the United States of Care, a non-partisan non-profit dedicated to improving access to quality health care, released at the end of November.  

Health care premiums in Nevada grew at a significantly higher rate than the cost of covered insurance claims, contributing to record-breaking health insurance company profits. The Nevada Department of Insurance (DOI) does not oversee provider and hospital rates, but does oversee the rates for small group and individual insurance plans in Nevada. 

And Nevada hospitals saw patient revenues outpace operating expenses, according to an analysis by the United States of Care, a non-partisan non-profit dedicated to improving access to quality health care released in November.

“The findings are stark. You see on one hand people who really struggling with affordability in really profound ways and on the other hand, you have a health care industry that is profiting and doing financially very well,” Liz Hagan, director of policy solutions at United States of Care, said in an interview.

Nevada’s insurance companies and hospitals both saw profit margins upwards of 15%, according to the report. 

The state’s largest private health insurance companies, UnitedHealth Group, Centene, and Anthem Blue Cross Blue Shield, are some of the most profitable Fortune 500 companies. UnitedHealth Group earned $28.4 billion in national profits in 2022, a 19% increase from 2021, according to the report.

In addition to revenues from the individual insurance market, the three companies cover 900,000 Nevadans who pay for Medicare Advantage plans, with sales each estimated to be worth $2 billion each. They also cover a bulk of the 46% of Nevadans with employer coverage. 

Representatives from UnitedHealth Group, Centene, and Anthem Blue Cross Blue Shield did not respond to requests for comment.

Compared to most of the rest of the nation, Nevada’s hospital industry is substantially more privatized.  At 55.3%, the state ranks 13th for the highest percentage of for-profit hospitals, according to 2021 data, which is the most recent cited in the analysis by the United States of Care.

The analysis cites this as one of the reasons for higher health care costs in the state, noting that despite the COVID-19 pandemic disrupting hospital operations, hospital recovered financially with the help of federal relief funding and that the for-profit hospital’s patient revenues in the state have outpaced the amount they spend on operating.

Sunrise Hospital and Medical Center, owned by the largest for-profit health system in the US, Hospital Corporation of America, charges patients the second highest prices versus the actual cost of care of any hospital in the nation, at an average bill mark-up rate of  12.9.

Representatives from Sunrise Hospital and Medical Center did not respond to requests for comment.

These profit margins don’t translate into better care — Nevada ranks 41st on overall health system performance, and last on prevention and treatment, according to the report. Nor do the poor rankings translate into stagnant prices —in 2023, Nevada consumers faced a 9% increase in health insurance premiums, according to the report. 

The impact of rising health care costs permeates other facets of life — higher hospital bills and health premiums have also been used to justify the increase in car insurance premiums and intensify health care debt, causing people to cut back on other household spending, deplete savings, skip payment of other bills, or delay attending college, buying a home or change their living situation, according to KFF, a non-profit foundation that does research, journalism, and communications programs on health care.

There have been some state-level efforts to curb the affordability crisis in Nevada health care including reducing prescription drug prices and developing a healthcare growth benchmark through the Patient Protection Commission. 

State lawmakers have laid the groundwork to create a public option health insurance program designed to offer coverage at lower costs. However, while filing for a federal waiver necessary to implement the public option, the administration of Gov. Joe Lombardo prioritized the federal funding for a reinsurance program for insurance companies.