Record-High Claims in 2021 Reflect COVID-19’s Impact on North Carolina
Other Cost Drivers
Beyond costs related to the pandemic, rapidly increasing spending on prescription drugs and rising price tags on medical tests and procedures were some of the top contributors to the record-high claims we saw in 2021. We are partnering with providers and others across the health care industry to address these rising costs, but we expect these issues to continue to put pressure on affordability.
Drug costs continue to accelerate at a rapid rate. In 2021, spending on prescription medications was up 10% over the previous year, with specialty drugs including those for autoimmune conditions, antidiabetics and oncology medicines up 15%. Costs of prescription drugs have been responsible for nearly half of our overall cost increases over the last two years.
We are executing a strategy that aims to bring down these costs and increase access to life-saving medicines. But there is more work to do on lowering drug costs for our members.
The pandemic also contributed to an increase in behavioral health claims, which jumped by 20% last year. Behavioral health spending now makes up about 3% of the company’s overall spending. We are looking at this increased spending on behavioral health as an investment that may help to prevent costly chronic health problems in the future.
Financial Strength
Our membership grew by 11% to nearly 4.3 million – including customers we serve on behalf of other Blue plans – with 440,000 new Medicaid members joining Blue Cross NC through our Healthy Blue offering.
Making health insurance more affordable is essential to expanding access to care; in three of the past four years, we’ve lowered premiums for our individual under-65 members. Despite the disruptions caused by the pandemic, we continued on our course to welcome new providers to Blue Premier, our value-based reimbursement model that has generated $350 million of savings in its first two years.
When we’re financially strong, we can make investments in communities, supporting the network of nonprofit organizations on the front lines of health and education. This community support is an important way we are making investments in better access to health care, better health outcomes and affordability.
We continue working with North Carolina communities to address non-medical drivers of health, which include a wide range of social, economic and even geographic issues that impact our well-being: food security, transportation, social isolation, safe and adequate housing, substance use disorder and addiction.
Looking Ahead
While we are seeing encouraging trends in COVID-19 infections and hospitalizations, many in the medical community believe the virus will ultimately transition from urgent crisis to seasonal threat. This will cause continued uncertainty for the broader health care community.
Volatility is nothing new in health care, and Blue Cross NC is prepared for it. As we have for nearly nine decades, we will continue to be here for our members, meeting their needs today and responding to their changing health needs in the future.
