Our Take
Healthcare affordability is collapsing fastest among the groups already priced out hardest: Black adults fell 16 points, Hispanic adults 19 points, young adults 17 points—while white adults dropped only 3 since 2021.
Why it matters
HR leaders and benefits teams are the first to see this pressure in employee health plan claims, pharmacy costs, and coverage elections. The widening gap between income tiers and racial groups signals a structural cost crisis, not a cyclical dip, that will reshape workforce health strategy and retention.
Do this week
Benefits teams: audit your plan's out-of-pocket maximums and prescription copays against this cohort data before renewal season, so you can identify which employee segments are silently deferring care.
2.8 million Americans fell out of affordability in one year
The West Health–Gallup Healthcare Affordability Index, which has tracked Americans' ability to pay for needed care since 2021, found that only 49% of U.S. adults can consistently afford both medical care and prescription medications when they need them (per West Health–Gallup). Over the past 12 months alone, 2.8 million people slipped below this "Cost Secure" threshold, bringing the index to its lowest point since its 2021 launch.
The decline is not evenly distributed. Black adults classified as Cost Secure dropped from 54% in 2021 to 38% today, a 16-point fall. Hispanic adults fell from 51% to 32%, a 19-point decline. White adults declined from 58% to 55%, a 3-point drop (per West Health–Gallup). Young adults aged 18 to 29 saw the sharpest one-year decline: from 39% Cost Secure in 2024 to 32% in 2025, a 7-point drop, and down 17 points since the index began.
Even middle-class households are fracturing. About one in three adults earning $120,000 to $179,999 annually are not Cost Secure. Among those earning $180,000 or more, one in five cannot consistently afford care (per West Health–Gallup).
Affordability gaps are structural, not cyclical
This is not a short-term shock. The index shows that racial and income disparities have widened consistently since 2021. Black and Hispanic adults are experiencing steeper declines than white adults, and the gap is not closing. Young adults—who typically have lower medical costs—are being priced out earlier in their working lives, which compounds over decades of coverage decisions and deferred care.
For benefits leaders, this signals two immediate pressures. First, employee health plan claims will reflect more deferred care, emergency room use instead of primary care, and higher rates of medication non-compliance. Second, retention risk rises sharpest among lower-income cohorts and younger workers, who have fewer financial buffers and more job mobility. The affordability crisis hits hardest where turnover is already highest.
Ask your pharmacy and medical claims vendors for cohort-level trends
Request a breakdown of your employee population by income quartile, age, and race to identify which groups are showing rising rates of claim denials, prescription fills delayed or skipped, or plan-year spending patterns that suggest care deferral. Compare this against your plan's out-of-pocket structure. If your Cost Secure rate has fallen faster than the national average, your plan design is amplifying the affordability crisis.
Consider three tactical moves before renewal: audit whether your pharmacy formulary is pushing employees to generic alternatives that work less well for certain conditions (a false economy). Pilot an income-based deductible or copay reduction for workers earning under $60,000. And tie renewal negotiations to a vendor commitment to transparent cost-trend reporting by demographic cohort, so you can track whether your fixes are working or whether plan costs are simply shifting the burden down.