According to TechSci Research report, “United States Health Insurance Market – By Industry Size, Share, Trends, Competition, Opportunity, and Forecast, 2018-2028,” United States health insurance market was valued at USD1150.23 Billion in 2022 and is anticipated to grow with a CAGR of
6.30% through 2028.
The U.S. health insurance market is anticipated to experience substantial growth during the forecast period, driven by various factors, including increased government and private initiatives and the widespread availability of diverse health insurance plans.
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Drivers of Market Growth
Rising Prevalence of Chronic Diseases
In recent years, the U.S. health insurance market has seen significant developments, largely due to the rising prevalence of chronic diseases such as diabetes, cancer, and cardiovascular disease. These conditions have heightened the demand for individual health insurance and comprehensive coverage, as more individuals seek financial protection against high medical costs associated with chronic illnesses.
Impact of the COVID-19 Pandemic
The COVID-19 pandemic has significantly raised consumer awareness about the uncertainties of life and health-related concerns. This increased awareness, combined with rising hospitalization expenses, has driven a surge in demand for health insurance among U.S. citizens. As people become more conscious of the potential financial burdens of unexpected medical emergencies, the market for health insurance continues to grow.
Government and Private Sector Initiatives
Various government and private sector initiatives have played a crucial role in expanding the health insurance market. These efforts aim to make health insurance more accessible and affordable for all citizens. The government's focus on programs like Medicare and Medicaid, along with private sector innovations, has helped increase the uptake of health insurance policies.
Market Landscape and Spending
Health Insurance Coverage and Expenditures
In 2021, the U.S. population was estimated at 327 million, with most individuals either having private health insurance or being enrolled in federal programs such as Medicare or Medicaid. However, approximately 8.6% of the population remained uninsured. In that year, health insurers, individuals, and federal and state governments collectively spent around USD 4.0 trillion on various health consumption expenditures (HCE), accounting for 17.4% of the nation's GDP.
Factors Influencing Health-Related Expenditure
The increase in health-related expenditure, encompassing both public and private spending on health programs, is influenced by various factors. One significant factor is the rise in overall employment, which increases the demand for health insurance both individually and through employer-sponsored health coverage. As more people gain employment, the need for comprehensive health insurance grows, driving market expansion.
Digital Transformation in Health Insurance
Online Presence of Health Insurance Providers
The increasing digital presence of health insurance providers is another key factor aiding the growth of the U.S. health insurance market. The convenience of purchasing and renewing health insurance online, combined with the rise in internet access and smartphone use, has led to a significant increase in online purchases of health insurance plans. Health insurance providers are leveraging digital platforms, including company websites and mobile apps, to offer seamless and user-friendly experiences to consumers.
E-Commerce Platforms for Health Insurance
Moreover, several websites now act as e-commerce platforms for health insurance plans, offering a variety of options from multiple providers in one place. These platforms provide consumers with a straightforward way to browse and purchase premium health insurance policies, further propelling market growth. The increased presence of health insurance companies in the online space is likely to drive market expansion even further during the forecast period.
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Challenges and Opportunities
Accessibility and Affordability of Health Insurance
Despite efforts to make health insurance more accessible and affordable, many U.S. citizens remain uninsured or underinsured. The high cost of healthcare and insurance premiums can make it difficult for some individuals to afford coverage. Additionally, many underinsured people still face high out-of-pocket costs for medical care, posing significant financial challenges.
Healthcare Reform and Access to Affordable Insurance
Healthcare reform and improving access to affordable health insurance remain critical issues in the United States. Policymakers and stakeholders must continue to address these challenges to ensure that more people can obtain the coverage they need without facing financial hardship. Efforts to reduce the cost of healthcare and insurance premiums will be essential in making health insurance more accessible and affordable for all.
In conclusion, the U.S. health insurance market is poised for substantial growth, driven by rising chronic disease prevalence, increased awareness due to the COVID-19 pandemic, government and private sector initiatives, and the digital transformation of the industry. While challenges related to accessibility and affordability persist, ongoing efforts to reform healthcare and improve access to insurance will be crucial in shaping the future of the market. As the industry continues to evolve, it will be essential for stakeholders to remain agile and responsive to the changing needs of consumers.
The United States health insurance market is segmented based on the insurance provider, type of coverage, mode of purchase, end users, region, and competitional landscape.
Based on the type of insurance provider, the market is segmented into public insurance providers and private insurance providers. Due to the country's broad adoption and use of government-sponsored health insurance (Medicare), which is mostly driven by the public insurance providers. As a result, public insurance providers dominate the market. Medicare is a federal government program that provides health insurance to people in the 65 and above age group. The program also covers certain individuals under 65 with disabilities or disorders. In 2021, an estimated 60 million people (18.2% of the US population) were enrolled in Medicare.
Based on the type of coverage, the market is divided into individuals and family. Based on the mode of purchase, the market is divided into insurance companies, insurance agents/brokers, and others (insurtech companies, third party, etc.). The insurance companies’ segment is expected to grow at a significant rate over the forecast period. This growth is attributed to the adoption of self-directed or direct insurance distribution channels, which allow health insurance companies to sell their insurance products directly to customers without the involvement of intermediaries.
Based on end users, the market is segmented into minors, adults, and senior citizens. The market analysis also studies the regional segmentation among the South, Midwest, West, and Northeast.
Key market players in the United States health insurance market include:
- Anthem Insurance Companies, Inc.
- United HealthCare Services, Inc.
- State Farm Mutual Automobile Insurance Company
- Centene Corporation
- Cigna Corporation
- International Medical Group, Inc.
- Humana Group
- Health Care Service Corporation (HCSC)
- CVS Health Corporation
- Oscar Health, Inc.
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“New product offerings are one prominent trend that is expected to influence the United States health insurance market positively over the next few years. Currently, the increasing awareness among consumers about health insurance and the benefits of health insurance policies in protecting against the financial consequences of various health-related treatments is adding to the demand for health insurance in the United States, and this factor is likely to continue boosting the market in the near future," said Mr. Karan Chechi, Research Director with TechSci Research, a research-based United States management consulting firm.
“United States Health Insurance Market, By Type of Insurance Provider (Public, Private), By Type of Coverage (Individual, Family), By Mode of Purchase (Insurance Companies, Insurance Agents/Brokers, Others (Insurtech Companies, Third Party, etc.)), By End User (Minors, Adults, Senior Citizens), By Region, By Competition, Forecast & Opportunities, 2028" has evaluated the future growth potential health insurance and provides statistics and information on market structure, size, share, and future growth. The report is intended to provide cutting-edge market intelligence and help decision-makers take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities present in the health insurance market United States.
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