Last week, the Office of Health Care Affordability’s Board made a groundbreaking decision to cap health care cost increases in California. This move is a nation-leading effort to control rising health care costs and make critical care more accessible and affordable for people. The 3% cap will be phased in over five years to minimize disruptions and ensure maximum compliance, starting with 3.5% in 2025.
Governor Gavin Newsom emphasized the importance of making quality health care affordable during a press conference last week. He stated, “Making quality health care affordable is a top priority for our administration. This action is a crucial first step forward in our efforts to reign in outrageous health care costs and make health care more accessible and affordable.”
By setting a cap on healthcare cost increases, this action will save lives by making preventative care more accessible to people who might otherwise avoid it due to high costs. The board based the target on the average annual change in median household income in California between 2002 and 2022, which was 3%. In December, the Center for Medicare and Medicaid Services said that the cost to practice medicine in the United States would increase 4.6% this year alone, while Californians spent about 5.4% more each year on health care in the past two decades.
In addition to capping healthcare cost increases, Governor Newsom announced that the state’s CalRx Naloxone Initiative has partnered with Amneal to bring down the cost of naloxone to just $24 per pack for the state’s Naloxone Distribution Project. This is a significant decrease compared to current market prices, which can make Californians’ lives more affordable and healthier by providing access to life-saving medication at an affordable price point.