Exploring the Growing Affordability Crisis in Healthcare

Rising insurance premiums and persistent cost pressures are forcing many Americans to make increasingly difficult financial decisions about their healthcare. In this Q&A, Alan Balch, PhD, CEO of the Patient Advocate Foundation and the National Patient Advocate Foundation, discusses how mounting healthcare and living costs are reshaping patient access, medication adherence, and affordability across income levels.¹

Drawing on insights from his experience supporting patients nationwide, Balch explores the growing strain on the healthcare safety net, the hidden economics behind health insurance affordability, and why navigating coverage—whether through employers, exchanges, or public programs—remains a complex challenge for many patients.^2,3

Access all five parts of our five-part video interview series with Balch:

1. Premium Inflation Is Reshaping Patient Access and Adherence
2. Affordability Strain Is Moving Up the Income Ladder
3. The Hidden Economics of Health Insurance Affordability
4. Strengthening the Safety Net for Chronically Ill, Lower-Income Patients
5. Complexities Behind Choosing and Using Health Insurance

PC: With employer-sponsored premiums continuing to rise well above inflation and wage growth, what specific financial impacts are you seeing on patients, and how does this affect their access to care or decision to stay insured?

Balch: For most low- and middle-income families, it's a perfect storm of costs across the board are rising, not just healthcare costs, but costs related to food, housing, utilities, etc., and many families’ incomes are not keeping pace with those cost increases, so then you get in a position where you're going to have to make a trade off, and these are people who are actively being treated for disease.

It’s not like the choice is, go to the doctor for a flu or not pay the out-of-pocket costs associated with this. These are pretty significant trade-offs they're having to make between paying the utility bill or paying for their cancer therapy or their medication for HIV or diabetes, for example. What happens is, as you can naturally conclude, is when I’m faced with increasing out-of-pocket costs, and for patients it doesn't matter where the out-of-pocket cost is coming from, it's all coming out of their pocket. Whether it's in the form of insurance premiums or coinsurance or a trip to the grocery store, those are all things that they have to pay for, and if you're in the midst of disease, you're going to have more out-of-pocket expense for your treatment. You're also probably going to be losing time off work, so you're going to be missing some wages at the same time. There's some downward pressure on your income if there wasn't already, and then you have rising pressure for costs for treatment and other things as well. Really what happens is you have to make trade-offs, and we see patients having to decide between paying their rent or mortgage or the utility bill, or paying for the last thing they have to pay for in their healthcare journey.

That’s the challenge, and when patients go without treatment, then what happens is the disease gets worse, the complications progress, and then ultimately, treatment costs, the interventions for treatment cost more, are less efficacious, and are more complicated.

Could you describe the types of affordability challenges that are now occurring at a higher income level? Why isn’t the public assistance safety net applicable to this particular group?

The Patient Advocate Foundation is our direct patient assistance foundation, where we're able to provide different forms of financial assistance to patients who qualify financially and/or provide them with a navigator, basically, who goes into the safety net and tries to find a resource for them. There’s always been a large number of low- and middle- income families in this country who can't afford or struggle with affordability when they're in the midst of treatment for all the reasons we describe.

What we're seeing now is those that are feeling that pinch—it's happening at a higher income level now. At lower income levels or socioeconomic levels, there’s always been that challenge. Now we're seeing that creep up into the 600, 700, 800,000% federal poverty level, and we don't have the capability to raise our income qualifications to serve more patients, because there's only a certain amount of money and resources available, and we're one of many in the safety net.

I think a challenge across the board is there's only so many resources and places—whether it's in the federal government or private charities or public charities like ours—that have assistance, and many of those are means-tested, and we already didn't have enough money to support all the people who needed it. Now there's more people who need it at higher income levels and it’s not possible to increase our income qualifications to the levels where people really need help, because we don't have enough to help those at the lower income strata where there's always been need.

I think that's the challenge for us as an organization, and then across the board, for any of the entities that provide safety net resources to those who are struggling to afford the cost of their healthcare and of life's basic necessities. The other thing I will say to that is because we are also an organization that searches the safety net for resources, if we don't have them, we also know what's available in the safety net environment and I will say, that is also shrinking. There's not as much available. There's more demand for what is available. There’s just not enough safety net. There's more need for resources to help people, and there's less of those resources available.

It’s no secret that being able to afford healthcare out of pocket is a major undertaking, and that is where health insurance comes into play. Could you describe the challenge of affording the true cost of health insurance, and how it’s subsidized?

We have to remember that we have decided to use insurance as our primary financial payment and affordability mechanism in the United States. I'm not saying that's right or wrong, that's just a reality. And insurance only works if everybody is insured, and the system is just based on that fundamental assumption that you're going to have insurance, so you do want a situation where everybody has some form of insurance.

The challenge is, no one can afford health care—I shouldn't say no one—most people can't afford healthcare truly out of pocket. That's why we have insurance, but even when they have insurance, people can't afford insurance, the true cost of it. So everybody, for the most part who has insurance, it's most likely subsidized in some way. This idea that only one segment of the marketplace has this subsidized insurance coverage and everybody else is paying full freight—that's false premise, because even in employer-sponsored health plans, just take premiums for example, the average employer pays 84% of their employees’ premiums.

So you already have a significant subsidy in the employer-sponsored market for the whole insurance package, but for premiums in particular, as well. If you look at Medicare Advantage plans, there's $11 billion worth of subsidies towards Medicare Advantage plans to help subsidize the cost of those plans. There's a $5 billion demonstration project right now in Medicare to subsidize premiums in Medicare—you already have a bonus of patients in Medicaid as well as a low-income subsidy, obviously who have subsidies to afford their health insurance as well.

It's pretty standard for there to be some assistance, whether it's provided by the employer or through government or some other means, to subsidize the cost of insurance to the individual, because very few individuals can afford to just buy a health insurance plan and pay for it. That's why you have the exchanges in the first place is they provided a path for a segment of the population who didn't have access to employer-sponsored insurance, didn't qualify for Medicaid or Medicare, and so we had to create a path for those individuals so that they could be insured.

In order to do that, you have to provide some subsidy to afford that. So that's sort of step number one is we have to remember that insurance is the key to access and the way the system is structured assumes some form of insurance, and almost everyone who has insurance, it is subsidized in some way at the individual level, so individuals are rarely exposed to the full cost of health insurance. Someone is subsidizing—to some extent—the cost of that health insurance.

How crucial is it for advocates to protect the safety net ecosystem for lower-income patients who also have a chronic disease?

Regardless of what the answer is to trying to figure out this broader issue of what to do with the marketplace plans or healthcare in general, there is always going to be a segment of the patient population who is going to struggle to afford insurance and their healthcare, and the cost of living when they have significant disease.

One thing I would say is we have to shore up and protect the safety net ecosystem for patients who find themselves in a situation where they have significant chronic disease, and they also have lower income, and therefore, it's already a struggle to afford the basic necessities of life. You throw in the cost—even in the presence of insurance—and there's still significant out-of-pocket costs for patients through their healthcare journey, including, like I mentioned before, just the pressure to have to take time off work and be away from work, which creates downward pressure on your income.

At the same time, there're costs associated with using your insurance, not just the premium to have it, but then there's always copays and deductibles and co-insurance that come with utilization of your healthcare. I would argue, at the very least, we have to provide a robust safety net, and what form does that take?

It could come in lots of different ways, but we have to have some form of safety net available to patients who are going to need help affording life's necessities and/or their healthcare costs in the midst and presence of significant life-threatening or debilitating disease.

Why is insurance such a complex financial mechanism for most people, regardless of how it’s provided?

Insurance is a complicated financial mechanism for most individuals, regardless of how you're provided it, whether it's employer, through exchanges, etc., or whether you have an HSA or a high-deductible plan, or different aspects of it. It’s a complicated financial instrument, and so whatever the solution is, I think part of the problem is that generally speaking, people don't know how to select the right insurance, and/or how to use their insurance appropriately.

That's the challenge with any solution—it still requires a level of understanding at the consumer level about how to pick appropriately, and then how to use your insurance in a way that makes sense. If you have an HSA plan, you've got to figure out how to maximize the contribution to that and then make sure you spend it appropriately.

Just picking, if you have options within your employer sponsored plans—which many people do—what's the right choice for me? Do I just pick it based on premium, which is what most people end up doing, but that actually can be quite problematic if you end up in a situation where you actually need more cost coverage utilization, as opposed to paying more premium, or whatever the construct is.

There’re trade-offs financially in how these products are constructed, both in how you purchase them and then how you use them. I think whatever solution is selected, let's say for the Affordable Care Act, for the exchange plans, you've got to make sure there's commensurate public education for that population about how to select their insurance and then how to use it, particularly if you're going to do something different or create an insurance product that's decidedly different, or markedly different than what most people have access to in general.

References

1. Pleio Uncovers the Underminers of Adherence With AI-Driven Patient Insights. PR Newswire. November 20, 2025. Accessed December 3, 2025. https://www.prnewswire.com/news-releases/pleio-uncovers-the-underminers-of-adherence-with-ai-driven-patient-insights-302620804.html
2. 1. Academy of Managed Care Pharmacy. Inflation Reduction Act (IRA) resource center. AMCP. Published 2024. Accessed February 27, 2026. https://www.amcp.org/advocacy/ira-implementation
3. 2. Wingrove P, Beasley D. US Negotiated Medicare Prices for 15 More drugs to Test Cost Savings Promise. Reuters. November 25, 2025. Accessed November 25, 2025. https://www.reuters.com/business/healthcare-pharmaceuticals/us-negotiated-medicare-prices-15-more-drugs-test-cost-savings-promise-2025-11-25/