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Every year, like clockwork, I gripe over cost of health insurance premiums. Am I paying too much?
The United States Bureau of Labor Statistics measures year over year changes in the health care component of the consumer price index (CPI). The monthly health care inflation rate for September, 2025 reflected a 3.28% annual rise. Our perception is that this is a relatively high increase, although in reality the current rate represent is slower annual growth when compared to the past 50 year average rate of 5.09%.
Admittedly, our perceptions of increased health care costs are slightly colored in part by how other CPI components also adjust. We envision a future where costs should remain constant, or even decrease over time. Even so, I venture we all acutely feel pain of increased health care costs, a price which typically outpaces inflation, and carry a special angst when trying to budget for personal health care.
My wife and I are extremely fortunate that my retirement package included an option to retain our current health insurance at the same employer subsidized level as when working. We have plans for high quality medical, pharmaceutical, dental and vision care. The benefits are worth their weight in gold, especially now that I consider myself only 80% immortal. We also have the option to continue supplemental coverage when Medicare begins.
Our co-payments for pharmaceuticals are a bargain. For example, I pay pennies per pill for medications to control high blood pressure. I am truly humbled when I consider how prescription coverage has given us access to powerful drugs that both extend and improve quality of life and every day health.
Yet I still find myself experiencing premium payment angst, especially when contemplating benefits for dental and vision component coverage.
Consider dental insurance. My father once said, “Ignore your teeth, and you won’t have to.” It was an edict he learned the hard way, having spent the equivalent of my first year’s college education on implants. With that said, the dental work contributed directly to his having an infectious smile during his retirement.
My grandmother never had dental insurance. She had perfect teeth, obvious to anyone who peered into the glass on her bedside night table.
My wife has nearly perfect chompers, requiring only scant fillings while in her youth. Unfortunately, those antique silver fillings recently began to fail, which required two rounds of replacement and one crown. The cost was manageable, but without dental coverage, the price would have been similar to a crown worthy of the House Targaryen.
My view towards vision coverage is best described as myopic. I have a stigmatism that requires exacting lenses. I am prone to mishandling my glasses, and therefore take full advantage of my yearly right of replacement included within our vision insurance plan. I manage this frugally, ordering generic frames and progressive lenses on-line at a cost less than 75 dollars.
My wife’s eyewear taste runs a tad more couture. Her recent annual optometric exam concluded with a significant prescription change. She has never been satisfied with the products supplied through on-line services. Therefore, off we went in search of a brick and mortar supplier. Lori suggested we visit Costco Wholesale, hoping to find a reasonably priced set of frames. She humored me and tried on multiple pairs. It soon became apparent that the only glasses holding her interest were the highball set located in the kitchenware section next to the cutlery.
Next stop was the mall. We visited an eyewear store with a poorly wired, neon logo above the entrance. Ironically, of all possible non-lit letters in the store’s name, it was missing an “I”. Not a good omen. There was a second eyeglass store in the mall, with options better suited to Lori’s tastes. Indeed, there were literally hundreds of frames from which to choose. 60 minutes later we narrowed options to eight frames.
Still too many choices. My vision began to blur. I took pictures of her wearing frames so she could contemplate each pair. She whittled the group to four possibilities, one of which I nixed because of the cost. While our country’s Philadelphian founding father Franklin may have been the inventor of bifocals, I could not fathom paying nearly three Benjamins for frames.
I am color challenged, so we asked the sales person to help pick a final choice. To play it safe, we also texted photos to my daughter. My wife settled on the winning pair when both the sales person and my daughter chose the same frames that Lori also considered her top choice.
Most of the expense for the frames was covered by our vision insurance plan, with additional allowance for accompanying lenses. Even so, my wife chose supplementary options (lightweight, scratch resistant and photochromic lenses) which considerably elevated the final price. Good thing I am on the low cost blood pressure medication I mentioned earlier.
Reflecting on benefits I receive from health coverage, I should probably “reframe” my insurance premium bellyaching. I should not question whether I receive value for paid insurance premiums; the answer is certainly yes. Rather, I should ask how insurance companies remain viable business entities, especially if everyone takes advantage of benefits like we do.
Jeff, may I ask if & how you measure for progressive lenses for on-line stores? I’m getting progressives for the first time & read that one shouldn’t order them on-line because exact measurements are needed.
Great question. I used Zenni (many times) with no issues. Their website is set to include extra information regarding progressive lenses. I was easily able to get that info from my eye doctor. Although, it might simply be prudent to go to a brick and mortar if it is your first pair of progressives, so that they can double check the final product.
Just a follow up note on my post. It was not meant to incite political rhetoric (please, let’s keep political views at bay). Nor was it meant to bash the insurance companies that provide healthcare. It was simply my humorous take, in a non-judgemental genteel way, on a financially related topic that affects my life (and budget).
Thanks for brightening my day, Jeff! Your description of how you settled on new frames perfectly matches my own.
Hey Jeff, does your auto insurance repair your car or homeowners insurance repair your roof? 🤔
Your health insurance doesn’t provide healthcare either – it helps pay for the care you need. So does Medicare.
That little nuance in words is such a big deal and so commonly used that it inhibits our ability to deal with the cost/coverage problem and understand the roll of true insurance.
Sorry, I can only add 1 up arrow.
Interesting take. Always welcome diverse opinions. Good to see how different peoples’ thoughts are about a common issue.
Jeff, I agree, but what I said was fact, not opinion.
I designed and managed health insurance plans for nearly fifty years. Insurance of any kind is intended to cover unforeseen and unaffordable expenses.
How do you see health insurance providing your healthcare?
I do understand your statements. You are indeed technically correct. I simply chose to think about it from a different angle. My mental picture combines all apsects of healthcare, which includes (in my mind) cost for insurance.
The humor was easy for me to see, and it gave me a couple of chuckles. I appreciate that.
Thanks! Dare I say “Laughter is the best medicine”….!
When I started my first job, my Kaiser monthly healthcare premium was $6, and the total cost was maybe $12 with the employer contribution added in. When I retired 42 years later, the monthly deduction from my paycheck to cover my wife and I was in excess of $1,000/mo. and, with the employer contribution added in, would have been $24K/yr.+. I can only wish that my ending salary was also 200 times higher than my starting salary!
That said, I am very happy to have classic Medicare, with Part D and supplemental coverage. It isn’t cheap, but we’ve paid virtually nothing out of pocket, even after several trips to the hospital (I now advise against becoming a serious cyclist after age 65!).
I note comments that have been made about the apparent “failures” of the ACA, which have not helped to bend the healthcare cost curve. While its worthwhile to note that millions more Americans have health insurance because of the ACA, GOP efforts to remove the requirement that young people be insured or pay a penalty was a significant blow to the underlying finances of the ACA. More importantly, the ACA lacked the bargaining power to obtain better pricing with drug, hospital and insurance companies If we really want to bend the healthcare cost curve, moving to a “Medicare-for-all” type of coverage with real bargaining power may be our only hope, but overcoming the political power of the entrenched health industry will not be easy or painless.
Yes it is the way, but it’s not bargaining power that will achieve much. Medicare simply dictates prices, but that can only go so far before creating adverse conditions. Plus M4A would have to pay fees higher than it currently does to be viable. But universal coverage is where we need to go with EVERYONE paying through taxes and premiums and out of pocket expenses.
Yes to all.
Medicare is excellent insurance for 80% of our need. Medigap for the other 20%. You have to pay to stay healthy. Overall all medical insurance combined is $14,000 for the wife and I. SS is up 2.8% and SS insurance is up 10%. Every doctor and health care person I talk to, indicates the Health Care system is broken. I do not have the solution, but I feel we are all in this together, and insurance should not just be taken away from many, and then premiums go up $2,000 or $4,000 a month. Drugs are additional, and at this time I find WellCare as a good solution. I only changed, because UHC AARP went for $28/month in 2023, to $56 in 2024, and $100 in 2025! That makes no sense to me. Just one other thing. Go to any major US city, like Chicago, and goes who owns most of the tallest towers, yep insurance companies. High in their premiums, and like pulling teeth to get what you deserve.
“Every year, like clockwork, I gripe over cost of health insurance premiums. Am I paying too much?”
The entire United States is paying too much! The ACA was extremely important for making health insurance available, but did it in a terrible way, by subsidizing an enormous money sucking industry of so called insurance companies to take our money and limit the care we can get. So, yes, your griping is entirely justified.
As for glasses, every year I had to buy new frames because they kept breaking. But 10 years ago I bought titanium frames. They cost 9x what I typically paid for other frames. But they are almost unbreakable. I take them on and off on and off and they don’t need to be adjusted. Yes, the lenses need to be changed, but the up front cost was well worth it. Until I look at how much money I’d have now if I spent the money on Nvidia or Netflix stock instead.
I spent 25 years negotiating health insurance benefits for my union, and another 5 as a licensed insurance agent. I’m not defending the industry, but I know that premiums are derived by experience. In other words, they look back at how much was paid out in claims, and add in administrative costs (see RDQ’s explanation below). So our premiums are determined more by what providers charge, and how much we use their services.
By one of your other posts, I think you might have an HSA. If yes, make sure you use it to your advantage, as tax free dollars can save you a lot of money on your out of pocket expenses.
One more thing; it is totally possible to invest your HSA funds in NVIDIA or Netflix stock.
You are wrong, way off the mark.
The problem is not, never has been “money sucking industry of so called insurance companies.” People who have that view are blocking our ability to reach a better place. Don’t drink the popular Kool- Aid.
The premiums you pay and the increases you receive reflect the cost and use of health care, not insurance company profits.
Premiums are reviewed and must be approved, the insurance company portion of premium is limited by law and the net profit margins for health insurance companies are less that your regulated utilities.
60% of American workers have healthcare coverage that isn’t even involving an insurance company and their employer’s face the same increases in costs.
If you are interested in the facts, ins and out about health care costs and insurance, here is a link to the health care section of my blog.
https://quinnscommentary.net/category/healthcare/
Really? How do you account for the following and it’s just one of the companies. Did this create better healthcare for the average UHC customer?
UnitedHealth Group’s net profit over the past 10 years has been significant, reaching an estimated $170 billion to $180 billion when summing its net income from 2015 through 2024. For example, its net income was $15.4 billion in 2020, $17.285 billion in 2021, $20.639 billion in 2022, $23.144 billion in 2023, and approximately $14.405 billion in 2024.
Very easy. The company profit is based on increase in volume of policies and includes insurance other than health insurance in some cases and also includes international sales for some carriers.
What I said about premiums and profits is correct. The increase in profits is not the result of just higher premiums for a fixed number of policies.
Take a look at the UHC balance sheet, or any insurer for that matter. Do you see the size of the investmetn portfolio? That portfolio earns most of the net income. When actuaries compute premums, the margin over the cost is very small to stay competitive.
If you would like a better authority, read the letters Warren Buffett writes in the Berkshire Hathaway annual reports. He explains how the insurance company uses “float” to make a profit. They hold and invest the premiums until a claim is paid.
Be as mad as you want over the profits UHC makes, but remember by using any insurance plan, you are sharing the risk and cost with the other people insured.
I’m not mad but what does this add to our healthcare?
Nothing more than the rant about UHC profits.
The Part B premium is going up. 9.7% next year to $202.90.
I used to get upset over health insurance premiums, even argued with my agent that I was healthy, had good lab results, why should I have to have insurance. My car insurance would pay if I was injured in a wreck which was in my stupid mind was the only likely risk. My agent prevailed and I once again signed up for a good plan……then out of left field discovered I have stage 4 prostate cancer!! (my PSA had been normal for years). So, I’ve paid very little out of pocket and probably had over two hundred thousand in medical costs so far. My agent is getting a nice Christmas present!
Wishing you the very best.
My heartfelt thoughts go to you for success against your diagnosis.
Regarding dental insurance, I could be wrong but it seems like dentists can charge whatever the market will bear for a given procedure. I’ve also heard the argument before that dental insurance with a low cap isn’t worth the cost since one can get the same preventative work done for about the same cost. It makes me wonder if (low annual cap) dental insurance might still be worth it so one has guaranteed access to the negotiated rates for more expensive procedures. My understanding is in-network dentists can’t exceed those negotiated rates for policy holders, even if the patient has exceeded their cap and is paying out of pocket. I don’t know but I wanted to share the idea and see what others on HD thought about it. Gene
I grew up with the UK’s National Health Service and have always found the US system bizarre (and Byzantine), but dental is the worst. In my area, at least for seniors, there’s usually a $1,000 or $1,200 annual cap. In fact it’s so bad the dentists have started offering their own versions. And periodontal costs are even worse. The first quote I got for treatment a couple of years ago was a cool $9,000. I found another periodontist, actually in the same office complex, to do the work for “only” $6,000.
I don’t have the same issues with vision. For many years, even with employer coverage, I have had vision insurance through VSP for $14/month. Some years ago I bought customized Silhouette frames in successive years, giving me one pair to wear and one for backup (very necessary for long term travel). I simply get new lenses put in the back up pair when my prescription changes. They don’t have frames in the traditional sense, so no angst over color.
Nice article, Jeff! Love the humor.
RQ’s comment made me go look up our costs.
In 2025 our costs were:
Me: Traditional Medicare Part B $2,200
Med Sup Plan G $1,458.12
Part D $590
Total $4,268.12 Annual or
$ 355.67 Monthly
Bride: Traditional medicare Part B $2,200
Med Sup Plan G $1.134.84
Part D $590
Total $3,924.84 Annual or
$327.07 Monthly
I can only assume RQ’s taxable income is far greater than ours if he is paying $2,000 a month.
IRMAA is not an issue in our case, as our annual Gross Income is@$134,000, but our taxable income for 2025 will be @ $45,000, after the OB3 benefits.
Our income is Social Security and Annuity Income,72% of which is tax-free (annuities funded with Roth dollars.)
So far, our first two years of retirement, having Medicare and Med Sup has been fairly pleasant, cost-wise. I maxed out my out-of-pocket for drug in late September, and my wife has just reached her $590 deductible limit.
Costs will, of course, be higher for 2026, but still very manageable.
Part of our situation is IRMAA, but the other part is when my former employer dropped our coverage we had to take Medigap in our 80s at entry age rates so we are each paying over $300 a month just for that supplemental coverage.
Kevin – thanks. Right now, combined, we pay roughly $8500 annually. Similar to your situation. Not too bad considering my lingering medical issues. But worth every penny! And, for what it’s worth, I am admittedly envious of those that worry about the IRMAA. It means they have done well!
And…I must admit that I am liking Medicare so far. Less co-pays and more certainty on what I pay for visits and meds.
From my perspective you are right. Complaining about IRMAA is like complaining about the taxes on big lottery winnings.
Or, complaining about the premiums we pay because we haven’t used any health care services.
I would be very happy paying premiums and never receiving a penny in return. Unfortunately, that is not the case. 😢
Happy wife, happy life:)
Oh boy, I feel your pain, Jeff. I’m perfectly happy with Costco Optical, my Chrissy has more expensive tastes. Sadly, we don’t have any insurance for optical or dental.
Like RDQ notes below, retirees are often the first to get thrown under the bus by former employers looking to cut costs.
I might add that Costco was great for my hearing aids.
Thanks for the humorous view of eyeglass shopping. I can relate. I agree that there are too many choices. A few years ago, while shopping alone, I sent selfies of possible picks to my wife and daughter to get their helpful opinion. For my last frames, I made certain my wife was present to make the final choice that pleased her.
Ed, thanks for the encouragement. Note: The trick is to remember to delete the selfies….
I think you figured it out Jeffrey. It’s that insurance is no longer insurance. yes, everyone with insurance does what you did and more. It’s someone else’s money after all 😎
Generally, dental insurance where you are paying the premium is not worth the cost. Same with vision. Most vision costs are manageable and diseases of the eye are covered by medical insurance including Medicare.
The reason your BP medication is pennies is likely because you have an older inexpensive Rx, not likely because of your plan. Check the total cost next time. Older is not bad by the way.
Keep in the back of your mind for future planning that the benefit package you enjoy can quickly disappear. Millions of retirees including myself have found that retirees are not a priority for employers when costs need to be controlled.
Several years after I retired all the employer benefits for post-65 retirees were taken away. Retirees have no guarantees even if their active benefits were negotiated under a union contract.
Let me add a thought about vision coverage. My CEO made the statement that selecting the vision plan was a math test that should be gven to every engineer before hiring. It truly is not worth the cost of the plan.
I was pleasantly surprised to find out that Medicare pays for eye examinations, excluding only the refraction procedure. I thought it did cover any part of a routine eye examination.
My father who retired from working at a major hospital had his retirement insurance whittled away year after year.
Indeed, my future budgeting plans don’t include my healthcare coverage from my past employer as guaranteed. Yet I am eternally appreciative that I currently have that option available now.
As I have mentioned before, for two of us the Medicare B, Medigap G and Part D premiums are a bit over $2,000 a month- with IRMAA. Happy budgeting. 🥵
Jeff. What a great, amusing article! Thanks for the morning smile. Reading about your spectacular spectacle odyssey made me want to take some blood pressure tablets on your behalf—I’m nearly disappointed I’m not on medication yet, lol!
Mark – thanks for the kind words. And congrats on having a naturally low BP!