Today, Explained - Why your health insurance is so expensive

Episode Date: November 9, 2025

It’s open enrollment season, and new health insurance premiums are causing sticker shock around the country. So how do you pick a health care plan that won’t break the bank? This episode was produced by Avishay Artsy and Danielle Hewitt, edited by Jenny Lawton, fact-checked by Melissa Hirsch, engineered by Adriene Lilly and hosted by Jonquilyn Hill. Image credit Stefani Reynolds/Bloomberg via Getty Images.  If you have a question, give us a call on 1-800-618-8545 or send us a note here. Listen to Explain It to Me ad-free by becoming a Vox Member: vox.com/members.  Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Don't get sick. You guys, it's time. We got to choose our health insurance again. Gonna be honest, I've been off my parents' insurance for almost a decade now, and I still call my mom to try to figure out which plan is best for me. Because somehow it keeps getting more complicated. Hey, JQ, this is Natalie. When I signed up for my benefits, I was given a big book.

And I was told, read the book and pick your benefits. And I kept asking, what do these policies mean? Can someone help me understand all this information in this book? And I was told, no. The benefit specialist kept telling me, I cannot pick your benefits for you. So if the HR specialist isn't helpful, who else are we supposed to ask on what these policies mean for us?

Well, Natalie, we got you. I'm John Glyn Hill, and today on Explain It to Me from Vox, we're going to make sense of open enrollment together. What all those acronyms mean, why we're paying so much more this year, and whether there's an alternative that actually works. First up, I talk to Lisa Jarvis. She writes about health care for Bloomberg, and she says that, like with any major decision, the key to choosing insurance is to start by looking within.

I would say the first thing to think about is how you use your health care. Are you going to the doctor regularly? Do you have a standing appointment with a health care provider that you want to make sure you can keep seeing that same provider? you know, do you have prescriptions that you take regularly? And then you want to look at what your options are. There's a few different kinds of plans that might be offered to you. There's an HMO, there's a PPO, and then there's some other things that are kind of in between. So in HMO, you're going to have to pick a primary care provider. That person is sort of determining how many other specialists you can see. You have to ask for permission. A PPO, you have a lot more

flexibility. That one, you can go see a specialist usually. without a referral. You can also see out-of-network people, you know, with a PPO plan. So I would be looking at how you're using your health insurance, what you think your health care needs might be going forward. For example, you know, are you turning to an age where you suddenly need, you know, a little more visits to the doctor? Are you thinking that you might be growing your family in the next year and just sort of weighing what you think you're going to need in the next year and then looking closely at the fine print of your plans. Okay, when it comes to price, how do these plans shake out? So you'll notice that the HMO is probably going to be cheaper than the PPO.

And that's because you've got this limited network of providers. You're not allowed to go out of network, right? And you have to kind of ask for permission to see specialists. The PPO is going to give you a lot more flexibility. And so it probably is going to be more expensive and you'll feel that. Okay, so we got HMOs, we got PPOs. There's more jargon that shows up in open enrollment, and I'm hoping you can remind us what it means. The words I'm thinking of are premium, copay, and deductible. So there's a premium. That's what comes out of your paycheck. There's the deductible. That's how much money you need to pay before your health insurance kicks in for certain services. And then there's the co-pay. So every time you visit your doctor, it might

might be $25, it might be $40. That's how much money you pay and your insurance pays the rest of it. So there's another plan that I've heard about, and that's the high deductible plan. What is that and how does that fit into these options? Yeah, so I think you want to think about how you're using health care. If you're someone who is not using a lot of health care, a high deductible plan might be good for you. What that means is you're paying very little in premiums. So the premium is the part that comes out of your paycheck, right? You see that number and it can feel really good to have it be a low number. But the tradeoff could be a high deductible, meaning that you first are going to be paying a lot of money up front before your health insurance starts to kick in and pay for your

coverage. You can also pair that with some other things like a health savings account, which can allow you to put some pre-tax dollars aside to help pay for that deductible. So it's complicated, but you want to think about how much you think you're going to be using your health care and sometimes a high deductible plan might be an affordable choice for you and make a lot of sense. Yeah, you talked about that health spending account. There's also a flexible spending account. What's the difference between those two? There are other ways that you can try to save some money on your health care expenditures for the year.

There's an HSA, which basically is a way of taking pre-tax money out. you have to have a high deductible plan. That's the key to know in order to have an HSA. And then you can decide how much money you want to put aside. That money can roll over for year to year, and it can also grow. So it can be invested. If you don't spend it, you can use it the next year. An FSA is a little different.

That's through your employer. And there's a limit similarly to an HSA, and you're putting money aside, and you have to spend it all in that calendar year. So you've got to be careful about thinking about what you want. to put aside. Usually there's either a little bit of wiggle room around like tipping over that's spending into the next year, or it could be that some employers could choose to let you carry a little the money over a certain percentage of it for the full year. But you can use that for lots of things. The copay, the deductible. You can use it for what you buy at CVS. That's, you know,

you'll look at the very end of your receipt at CVS and there'll be a line that says FSA eligible or HSA. That can be deducted. You can get that money back. Yeah, I did discover that I could buy my fancy sunscreen with an FSA. That was exciting. I mean, I nerdily save all my CVS receipts. And at the end of the year, when I realize I am running at a time to spend my FSA money, I go through them all and I find all sorts of things I never would have expected are covered by an FSA. This whole process seems like it can be so confusing. Do you find it confusing? I mean, you cover this. I find it very confusing. My mother-in-law was trying to pick a plan through the ACA. I found it very hard to help her. Luckily, the ACA has navigators so you can go to one of those people and they'll help you find your plan. When it comes to employer-sponsored insurance, you just really have to think about all the different ways that you might be paying or not paid, right? So you just have to think about how you're using your health care and how your insurance is covering what you might use. It's complicated. It can be a really, it's like trigonometry and algebra and geometry combined. I don't know. Trying to calculate all the right factors and come up with the right choice.

But I think ultimately trying to understand what your family can afford and what they use, you know, is also going to help you as you try to do the calculation of what makes the most sense for you. This year, when you open that email and from your HR and look at what the premiums are, open up the, you know, Obamacare to find out what your plan will cost next year, you might experience a little sticker shock. Healthcare costs are going up and employers are trying to balance absorbing some of those costs or managing some of them with passing them on because they can't afford it all either. And so, you know, look at the fine print. It might be that your premium doesn't change, but it might be that there's more costs on the back end that you should be aware of.

So I just think really paying extra close attention, this is the year to not just accept the plan that you've had every year and just weigh your options carefully. You heard right. Premiums are about to go up. A lot. Coming up, we'll explain why. Support for this show comes from the Audible Original, The Downloaded 2, Ghosts in the Machine. The Earth only has a few days left. Rosco Cudulian and the rest of the Phoenix colony have to re-upload their minds into the quantum computer, but a new threat has arisen that could destroy their stored consciousness forever. Listen to Oscar winner Brendan Fraser reprised his role as Rosco Cudulian in this follow-up to the Audible original blockbuster, The Downloaded. It's a thought-provoking sci-fi journey where identity, memory, and morality collide.

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The downloaded two, Ghosts in the Machine. Available now, only from Audible. This is Explained It to me. I'm JQ. and today we're explaining all things health insurance, including why it's so expensive this year. No matter where you get your insurance, whether it's through your job, the Affordable Care Act marketplace, or Medicare, the price is going up. To find out why, I went to D.C.'s number one go-to for health care reporting. I am Julie Rovner. I'm Chief Washington correspondent for KFF Health News, and I'm a host of What the Health, brought to you by KFF Health News, and WAMU-8-5F. Julie has covered the health care system for nearly 40 years. And she says that while the costs always go up, this time is different.

Well, we are talking premiums going up pretty much across the board for every kind of health insurance right now. You know, we've had bigger inflationary spikes, particularly in the early 2000s. But for the last 15 years or so, health care costs have been rising, but not terribly fast. They seem to be accelerating again now. Why now? Well, there's a bunch of reasons, but they come down to sort of two things, price and utilization. Utilization is how many health care services people use. And obviously, the more services people use, the more the nation's health care bill goes up. So there's a lot of things that are driving expanded use right now. One of them is aging the baby boomers. I am one of them.

As we get older, we suddenly get and need more health care. And to some extent, we're still catching up from health care that people didn't get during the pandemic when nobody was leaving their houses and when you basically didn't go to the doctor unless you absolutely had to. So we're still seeing people not only getting care that they didn't get then, but people who didn't get care then and should have who are sicker than they might have been if they'd gotten preventative care or care early in the pandemic. So that's sort of driving up use. And then, of course, there's just new things that we can do. Everybody knows about the GLP1 weight loss drugs that are so popular and so highly used right now. We have lots more new drugs. I mean, some of these are sort of amazing advances.

It used to be you didn't want to do things. And, you know, it was always cost benefit, whether the benefit was worth the cost. And the cost was not just monetary. The cost was in how long you would be laid up if you had a joint replacement. or had some kind of surgery. Now we have much easier surgeries. So it makes it much easier to do these things, so we're doing more of them. So that's just the usage side.

Then there's the price side. And the price side basically, you know, I can sum up in one sentence. We have the highest prices in the world because people who provide health care here can. The government doesn't regulate it nearly as much as they do in other countries. Most other countries have, do have hybrid systems. They do use some private insurance. and some government subsidies. But they also, most of them that don't have spending out of control,

have much more serious regulation of prices than the United States has. It's really wild because we should be going to the doctor. We should be taking care of ourselves. But it feels like when it comes to the price of things and the price of insurance, we kind of get punished for it. Yeah, we do. And, you know, one thing that I didn't mention is that because we now spend so much on health care that it's like 18% of our GDP, lots of people who would like to earn money are going into

health care. So we have people sort of encouraging possibly unneeded health care to make a profit. So there's that piece of it also in addition to the things that we should do and that end up costing us money. Is there a difference in, you know, the rise and costs we're seeing for those of us who get employer-sponsored insurance versus those of us who get our insurance through the ACA marketplace? There is. And, you know, one of the reasons that in 2026, ACA premiums are rising is because of these additional subsidies. It made it easier for people to get health insurance under the ACA, the expanded tax credits. It basically doubled enrollment. And insurers, seeing that those extra premiums were scheduled to end, said, well, a lot of

of people are going to no longer be able to afford their health insurance. So we're going to have to raise premiums on the theory that the sick people are going to hang on to their health insurance and the healthier people are probably going to drop it if they see the prices go up. Although everyone will be affected if people can no longer afford their coverage and go uninsured because like with the pandemic, they won't get medical care until they absolutely have to and then it's more expensive. And then the cost of that care is going to have to get passed along to somebody. Are employers absorbing some of these higher costs for people who get that employer sponsored insurance? It depends. You know, during times when it's hard to hire people,

and we have tight labor markets, employers try to absorb as much of the increases in health care spending as they can because they don't want to load more onto their workers and therefore make it harder to win new workers and retain old workers. Right now, the labor market it is not as strong as it has been and health care costs are going up. So it's expected that a lot of employers are going to pass along a lot more costs to their workers. What can consumers do to try to mitigate these costs? Like, you know, it's getting expensive. What can we do? It's really hard. You know, there are a number of people who think that price transparency is a big help. It's probably not the answer to everything. But knowing what things cost in advance certainly doesn't hurt.

being able to shop around for elective things also doesn't hurt. Sometimes, you know, if you go to a hospital, you can find the same care as an outpatient for much less because of the complicated ways that government and private insurers pay for these things. Sometimes you can offer to pay cash instead of use your insurance and you can save money. That's very true for things like generic drugs. So there are ways to save some money, but we're all sort of captives of the mess of a health care system that we have right now. Okay, so everyone is focused on premiums right now because they're going up, but that's just one symptom of what is going on with our health care system, right? Like, there's a bigger problem here. There definitely is. And obviously, Republicans are saying, you know, we're over subsidizing for the ACA, which is a mess. Obamacare is terrible. It's bad health care at far too high a price. And it's become a boondoggle.

It's a subsidy for insurance companies. When you subsidize the health care system and you pay. insurance companies more, the prices increase. That's been the problem. Well, we subsidize everybody else who gets health insurance. You know, the federal government subsidizes Medicare, federal and state government subsidize Medicaid. There's a gigantic tax break for people who have employer provided coverage that most people aren't even aware of. So it's really only been people who buy their own coverage in the individual market and small businesses who haven't been getting a subsidy. And that's what this is.

If insurance just keeps getting more and more expensive, do you think we'll see more people just kind of opt out of it altogether? Well, that's a concern. And, of course, that's where we were before the Affordable Care Act passed when we had, you know, 14% of the population that didn't have insurance. Now it's down to an all-time low of about 8%. But, you know, we're definitely going to see people lose their insurance, even if they're not dropping it voluntarily. The bill that Republicans passed this summer takes away eligibility. for a lot of people and out-of-pocket costs, as you say, are going up dramatically, even if you do have insurance, deductibles and copayments and just the cost of medical care in general means that even people with pretty good insurance end up owing lots of money out of pocket. So I think we're sort of coming to another transition point where this is going to be back on the national agenda. Up next, we talk about some creative solutions to our health care problems,

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Get the new iPhone 17 Pro at tellus.com slash iPhone 17 Pro on select plans. Conditions and exclusions apply. HJQ back with Explain It to me and it's safe to say most people agree that the American healthcare system is broken and that it's probably not getting fixed any time soon. So what are we supposed to do

meantime. That's the question I asked my colleague, Dylan Scott. He's a senior correspondent at Vox, and he covers health and the health care system. You know, for some people, it's like, oh my God, like I broke my leg or I got diagnosed with cancer, and, you know, you see people going to GoFundMe or Kickstarter, just literally basically begging people, like, please help me with my medical costs. I just created a GoFundMe page, and I'm trying to raise money to help me pay for my health care expenses. Obviously, we expected some out-of-pocket costs, but not this. I'm looking for help. Unfortunately, like, that's one predicament

that the U.S. healthcare system puts people into if they have, like, a serious medical need is you might just have to, like, beg strangers to chip in to cover your bills. But short of that, you also have Americans. They're, like, looking for basically insurance-like products, you know, something where it's like you pay a monthly payment, and if you have medical bills, hopefully it's gonna cover you.

And there's a few different variations on that. There is something called short-term limited duration insurance, which, like, ideally is supposed to be, like, a three-month plan that you get on when you're between jobs or something like that, but some people are trying to go on those on a more permanent basis. There are things called association health plans, which are supposed to be, like, groups of businesses who pool their resources together to try to cover their workers' health care costs. And then, you know, what I think is one of the most interesting ones is something called health care cost-sharing ministry. What is a health care co-sharing ministry? So, like, in their original form, basically what this is, is like a group of people, you know, maybe literally a group of people who go to the same church together, who are like, okay, we're going to pool our money together. We might ask people who participate to adhere to certain moral, ethical standards that,

you know, reflect our Christian values. And then, like, you know, it's, in theory, supposed to work like, insurance where it's like you pay into this pot, and if you have a medical claim or some kind of medical issue comes up, you receive health care services, you can take those bills back to the group, and they'll give you money out of the pot to cover the cost. Technically, these kinds of arrangements have been around for decades, like the first one started back in the early 1980s. But for a long time, I mean, they were really niche. But then the Affordable Care Act passed, and was this big,

flashpoint politically, as people well know. Especially for, like, deeply conservative and religiously devout people, they had a lot of objections to the ACA. Some of them had objections to, like, the provisions that required insurers to cover birth control, things like that. And so they were like, you know what? I want to like opt out of this law. And actually, the law in the way that it was written kind of gave them an out. It said that if you sign up for a health care cost-sharing ministry. If you're enrolled in something like that, then you can be exempted from the individual mandate. And so I think all of those things combined together to start driving a lot more people to these health care cost-sharing ministries. It sounds a lot almost like mutual aid.

Yeah, I think that's the crux of it. I think in a lot of ways. But increasingly, these are like sophisticated businesses with really well-funded advertising campaigns. Finding affordable health care. can be stressful. And some people think that insurance is their only option, which is why CHM is the first to establish a cost-sharing ministry. It's a collection of specialized care components, resources that help you through life's most challenging medical moments. You know, they've increasingly de-emphasized the religious aspect of it.

You see them adopting names like Liberty Health Share and things like that. Even with like the moral and ethical standards, that they want people to sign on to, they've kind of more and more de-emphasized, like, you have to believe in God and that Jesus Christ is our Lord and Savior, and it's more like, you know, you're going to be an upright person, you're going to, you know, be moral, but in a sort of vaguer, more secular way. And I think that's because these companies see a business opportunity. How many people use these kinds of ministries?

Back in the day, in the mid-2000s, there were like 200,000 people enrolled in these plans. as of about 2018, there were a million people enrolled in a cost share. So, yeah, like a pretty significant increase from the decade before. And then pass that as the most recent estimate that we have. And it's worth emphasizing, like, because these things are poorly regulated, it's hard to get really reliable data about them because these can kind of just operate without the government, even really knowing about it.

But the Colorado Department of Insurance tried again to estimate how many people have joined these ministries in 2023, and they came up with 1.7 million Americans were now enrolled in a health care cost-sharing ministry. So, like, that's pretty exponential growth if you go back to just, like, 20 years ago. And how has it worked out for people who are in these ministries? So I think it's really important for people to understand. These ministries are not subject to the same rules about pre-existing conditions, about not putting annual limits on people's benefits. All of the insurance regulations that people have gotten accustomed to after the ACA became law do not apply to these health care cost-sharing ministries.

So you're basically just relying on sort of the goodwill of these ministries to pay out and just like hoping that they have enough money to cover whatever your medical bills may be. The way that insurance works is it needs scale. You need a lot of people paying into the pot. frankly, you need a lot of people who are healthy, who don't have serious medical needs, who are just paying their premiums in and not taking anything out. And that's hard to do sometimes, as we see, with rising costs across the whole system, with, like, hundreds of thousands or millions of people enrolled in your health insurance plan. And so you can imagine with some of these smaller health care cost-sharing ministries,

which, like, you know, individual ones may have maybe hundreds or just like a few thousand people enrolled, there might not be enough money in that cost-sharing ministry to cover the costs. And so then you're kind of just shit out of look. Yeah. Is scaling up the solution for these ministries? Is that, would that solve that problem? The way to solve what's going wrong with our health care system is not to scale up these health care cost-sharing ministries that can then discriminate against people with pre-existing conditions. I think instead what we need to do is like we need to be looking at the whole system's costs,

figuring out how to bring those down, which is hard and which is going to take some difficult work. But I do not think these plans themselves are the solution. What is the solution? It's the worst time of year because it's, yeah, it's like, hey, sign up for health insurance and yeah, your premium's probably higher than it was last year. And, you know, the deductible might be going up to. And it's like, I think in the long time, term, we need like policymakers and the industry and the payers to come together and figure out

how to make just the overall costs of health care lower so that we can provide people with comprehensive coverage more affordably. But in the meantime, yeah, we live in America. We're individualists. We're consumers. You kind of got to look out for yourself and just be really careful about how you're kind of making those calculations because it really depends on your individual situation. If you want to know more about health insurance and how to navigate open enrollment, head over to vox.com. We have an entire guide on how to use your benefits, and we even get into the history of why this all works the way it does. Soon on Explained it to me, we'll be talking turkey. Thanksgiving is around the corner, and we want to know what you think of this dinner mainstay.

Do you love turkey? Hate it. Have a go-to-way to work turkey. prepare it? A favorite alternative? Give us a call at 1-800-6-1845 or email us at AskVox.com. If you love listening to Explain it to Me, there's a way to love it even more. By listening to it ad-free. You can do that by becoming a Vox member. You'll also get to listen to other great shows like Unexplainable in the gray area with no ads too. And you also get a ton of other perks. We're having a sale right now where you can get $20. learn more and get the deal by going to vox.com slash members today. This episode was produced by Avishai Artsy and Danielle Hewitt. It was edited by Jenny Lawton and our executive producer is Miranda Kennedy. Fact-checking by Melissa Hirsch and Adrian Lilly and Patrick Boyd did the engineering. I'm your host, John Glenn Hill.

Thank you so much for listening. Talk to you soon. Bye! Thank you.