A crisis of confusion is making health care more expensive for many Americans.
Of all the culprits that make it harder for Americans to afford and access health care, the sheer confusion many patients experience when trying to select an insurance plan or when faced with an expensive medical bill may be the most overlooked.
That’s according to a recent survey from research firm Perry Undem, which reveals the deep confusion Americans feel when receiving health care — confusion that could put them on the hook for higher costs.
US health care costs are dire enough as-is, and it’s easy to look at the data on US prices for common procedures compared to the prices in other countries, or to compare the out-of-pocket costs Americans typically must pay for medical services under their insurance plan compared to their peers elsewhere and see the issue. It’s the prices, stupid, as some of the country’s leading health care economists once described the problem.
And the prices are indeed a big part of the US health system’s shortcomings: Research has shown that people will skip necessary care if they have even a small cost to pay, and recent surveys find one in three Americans say they have postponed medical treatment in the last year due to the cost.
The Perry Undem survey, which polled nearly 2,700 Americans on behalf of the American Cancer Society’s Cancer Action Network, the Leukemia and Lymphoma Society, and RIP Medical Debt, also detected widespread struggles to afford health care. About 7 in 10 people say they have received a medical bill that they could not afford, it found, and more than 60 percent of Americans said they had made some kind of sacrifice — delaying care, skipping appointments, changing the food they buy at the grocery store, etc. — in order to afford health care in the past two years.
But new data, from Perry Undem and from the health policy think tank KFF, further indicates that Americans have a lot of misconceptions about how their health care and insurance benefits are supposed to work, and could find themselves exposed to higher costs as a result. About 40 percent of people said they were always or frequently unsure how much their medical services would cost after they received care, according to the Perry Undem survey; another 30 percent said they were uncertain about the costs at least some of the time. Nearly two-thirds of US patients said they were at least sometimes unsure how much their insurance plan would cover after being treated.
More than half of Americans said they were either always, frequently, or sometimes uncertain about whether they had been seen by an in-network provider when receiving medical care. If they were treated by an out-of-network doctor, most insurance plans will charge the patient more money out-of-pocket for those services.
Those front-end issues — seeing a doctor or receiving a service not covered by your insurance plan — can create big medical bills in the first place. But patients also often don’t know what to do when they receive an invoice they can’t afford.
Only 3 in 10 Americans said they had fought or appealed a medical bill they had received. The survey reveals wide disparities in who has actively worked to reduce their health care bills: Older Americans, people with a college education, and white Americans were roughly twice as likely to say they had contested a medical bill than young adults, people without a college education, or Black Americans.
Why are so few Americans fighting back against exorbitant medical costs, even though 70 percent of those who did said they were successful in reducing their balance and experts like investigative journalist Marshall Allen have pleaded with patients to “never pay the first bill”?
Once again, confusion is to blame: 23 percent of respondents said they didn’t know they could fight a bill, 19 percent said they didn’t know the steps to take, 17 percent said that the process was overwhelming, and another 12 percent said they were too busy to contest a bill. Many Americans are also ignorant of the financial assistance that may be available to them: Nearly half of the people surveyed were not aware of the programs run by hospitals or physician practices that are meant to help patients pay their share of their bills. Only one in four said they had actually asked for or been offered such assistance.
The findings of the Perry Undem survey — that patients are often overwhelmed by the complexity of the health care system and unaware of their options to reduce their own costs — are consistent with other recent studies. KFF’s Larry Levitt and Drew Altman recently wrote in JAMA Forum that complexity in US health care is “the enemy of access and affordability,” citing results from a KFF survey taken over the summer.
About 6 in 10 Americans said they had experienced a problem using their health insurance in the past year, according to KFF. People reported being unable to receive care, experiencing a decline in their health, and/or paying more than they expected for treatment as a result of those insurance problems. In findings similar to those of Perry Undem, the KFF survey found 60 percent of Americans didn’t know they can appeal a medical bill and three-quarters didn’t know which government agency to contact for help with insurance issues.
“Complexity is [an] underappreciated problem that hinders access and affordability and is … difficult to quantify,” Levitt and Altman wrote in their commentary. “The reality is that many people are hopelessly confused by how their insurance works,”
The confusion starts during open enrollment, as Levitt and Altman noted, when people enrolling in Medicare Advantage have more than 40 plans available to them, on average, and people who sign up for coverage on the Affordable Care Act’s marketplaces may have more than 100 to choose from. HR industry surveys have also found that people who enroll in health insurance through their job often feel uncertain about the selections they are making.
And it continues as people actually receive medical treatment and then receive a bill, as evidenced by these findings. People don’t know if their providers are in-network or that they can contest a bill, and they may end up paying more than they should as a result.
Congress and the states have attempted to take steps in recent years to reduce the confusion among patients. Insurers are supposed to provide accessible and up-to-date provider directories. The No Surprises Act sought to remove patients from any disputes over out-of-network emergency bills, leaving the insurer and hospital to sort out the costs. But enforcement remains inconsistent, Levitt and Altman noted.
These surveys suggest that Americans remain perplexed by the process of seeking out medical services and paying for treatment — and their health is suffering as a result.
Financially, the sharing economy darling is thriving, but guests, hosts, and cities have had enough.
Airbnb knows people are unhappy. Its CEO, Brian Chesky, has acknowledged the “tens of thousands” of complaints across social media about the platform’s growing costliness. It knows that hosts’ expenses — like home insurance, property taxes, and the cost of labor for cleaning and maintenance — have climbed amid a period of high inflation. The internet is strewn with complaints of pictures that don’t match the actual property, extreme demands and rules from hosts, hidden cameras, reservations getting unceremoniously canceled, and more. And several cities are aiming to regulate short-term rentals, even setting down a de facto ban on them, as New York, one of the biggest Airbnb markets in the US, did in September.
Yet Airbnb, which launched in 2008, is also making more money than ever. Bookings reached an all-time high earlier this year, and the company raked in almost $2 billion in profits in 2022, marking its first full profitable year. Airbnb’s stock price is also up dramatically from where it was at the end of last year.
All this success is part of the company’s problem. What started as a scrappy idea offering an affordable alternative to hotels has now made Airbnb a target for lawmakers and a magnet for critics. Airbnb may not be collapsing, as some doomsayers are predicting, but it is facing a reckoning — an existential questioning of what it offers and where it will go from here.
The great pandemic Airbnb boom transformed the business
How Airbnb arrived here is complicated. Covid-19 was a giant blow to the travel sector, including Airbnb, as lockdowns reduced the supply of short-term rentals by a significant 25 percent, according to Jamie Lane, chief economist at AirDNA, a short-term rental data analytics firm.
Simultaneously, people also started wanting more space outside of dense cities. Interest rates were very low, so in general, people bought houses during this period — some to live in, others to rent out.
Meanwhile, the idea that one could get rich by becoming an Airbnb host — the gold rush-like dream that helped spur the company’s success through the 2010s — found renewed popularity on social media platforms like TikTok, Reddit, and YouTube. New hosts were encouraged by just how quickly demand bounced back: By 2021, domestic travel was revving up again, but concentrated on rural destinations where social distancing was easier. Supply couldn’t catch up fast enough, and Airbnb prices leaped. Amateur investors eager to meet the Airbnb demand bought up properties to turn into short-term rentals, piling in “when the rates were really low,” says Lance Lambert, a housing expert and editor of real estate analytics site ResiClub.
Between mid-2021 and mid-2022, the number of new Airbnb hosts in the US jumped by over 50 percent, and the growth was biggest in small towns, says Lane. Expansion, however, hasn’t been an entirely positive change: In some cases, Airbnb has rapidly changed the character of these neighborhoods from residential areas to tourist towns. Because there are so many more listings now, Airbnb hosts say they are watching their bookings plummet. The flood of new hosts has meant fewer can earn good money. “Now, the markets are completely oversaturated,” says Melody Wright, founder of mortgage strategy and technology company Huringa.
Meanwhile, excess supply hasn’t led to lower prices, and anecdotes about bad Airbnb experiences keep pouring in. Some of the most vocal grievances center on cleaning fees. In the US, only 15 percent of Airbnb listings don’t have cleaning fees, and a NerdWallet analysis found that cleaning fees now make up about a quarter of the total price guests pay. Airbnb’s service fee is generally under 14 percent on top of the nightly rate, and it also takes 3 percent from most hosts.
All this is encouraging a hospitality-industry doom loop: If hosts see their bookings drop, they might try to raise rates to make up for it (or at least resist lowering them), which drives guests back to hotels or the cheapest Airbnbs that tend to be run by bigger professional hosts who can afford to cut prices in ways small hosts can’t. If hosts try to lower rates to draw in more bookings, they might still be unable to turn a profit. “For both the guest and the host, it’s just not a good value proposition anymore,” says Wright. The only one winning, it seems, is Airbnb.
Airbnb did not respond to Vox’s request for comment. But Chesky has been vocal about listening and attempting to fix guests’ top gripes. In its 2023 fall update, Airbnb rolled out a site layout letting customers see the total price, including cleaning fees, when browsing listings. This feature follows the release of a new pricing tool for hosts that would display rates other hosts are charging nearby — a way to encourage hosts to lower their prices. “We need to get our house in order,” Chesky told Bloomberg in a recent interview. Ultimately, Airbnb doesn’t seem to be able to — or perhaps won’t — rein in the high rates and fees customers are grumbling about, and hosts continue to bemoan that they aren’t given the support they need to thrive.
Why are cities cracking down on Airbnb?
Airbnb began as a more flexible, more social experience than hotels, but that sense of peer-to-peer exchange has all but disappeared. Airbnb hosts today are often professionals who intend for hosting to be their main job and source of income, and new hosts often list entire homes rather than home-sharing their primary residence. Many form LLCs, hire employees, or engage the services of professional property management companies to manage their listings. The majority of Airbnbs are run by hosts with multiple listings. That’s contributing to the persistent shadow now looming over Airbnb: the perception that it’s a social ill worsening the housing crisis.
Last May, Curbed reported that the number of Airbnb listings outstripped the number of available apartments for rent in all of Manhattan, Brooklyn, and northwest Queens. That lopsidedness is happening in many other cities, too. Asheville, North Carolina, has 2,881 properties — not private rooms — listed on the service as of September, according to Inside Airbnb, a site collecting data on Airbnb units to show the company’s impact on residential communities. At the time of writing, there are a little over 250 long-term rentals listed on Zillow. Austin had 12,205 full-property Airbnbs and about 3,700 long-term rentals. Skyrocketing rents in the past two years have been a major issue in both of these cities.
The national housing shortage has led to more scrutiny of Airbnb as short-term rentals constrain housing supply that would otherwise be available for residents. Studies have shown that Airbnbs raise home values and rents, and the impact tends to be bigger in very densely populated areas where the housing shortage is worst. A 2018 report from the NYC Comptroller’s office estimated that 9 percent of the city’s rent increases between 2009 to 2016 could be blamed on Airbnb.
It’s not just cities. The Airbnbs that have moved into rural America at full force are also becoming an intense concern for residents facing ever-higher rents and home prices there.
“Take somewhere like Missoula, Montana,” says Wright. The small city of about 77,000 people had 60 homeless encampments as of August 2022, while the state has seen a 62 percent increase in homelessness since 2019. “Missoula never had a homeless situation, not like this,” Wright says. The median listing for a home is now over $600,000 there. AirDNA currently shows over 600 active short-term rentals in Missoula, the vast majority of which are entire homes, while Zillow shows just over 200 long-term rentals. Other small towns are facing similar rapid changes. Sedona, Arizona — a town with under 10,000 residents — is running rampant with short-term rentals as its reputation as a tourist destination grows. As of 2021, as a report from Wired last year highlighted, 15 percent of Sedona’s housing supply was listed as short-term rentals. Right now, AirDNA shows about 2,800 active listings for entire homes; Zillow shows about 50 long-term rentals. The median price of a single-family home there is now over $1 million.
“And so you have no affordable inventory for anyone anymore,” says Wright.
Anti-Airbnb neighborhood groups have been popping up in communities for over a decade now, and though they’re spread all across the country, their grievances are similar: They don’t want higher rents and property prices, and they don’t want to be surrounded by noisy Airbnbs occupied by a revolving door of strangers. Plus, there are some unexpected knock-on effects when there’s a housing shortage exacerbated by short-term rentals: Amid a national teacher shortage, for example, schools struggle to find teachers because many can’t find affordable housing in the area.
Can Airbnb fix its problems?
The relative slowness of Airbnb regulation, happening in piecemeal fashion across the country, is why so many regions now find themselves overrun with short-term rentals. The era of an unfettered short-term rental market, however, is over.
New York, San Francisco, Los Angeles, and Honolulu are among the major cities that have passed short-term rental restrictions of varying strictness. In New York, hosts must now register their short-term rentals listed on sites like Airbnb, firming up enforcement of its existing short-term rental laws, including a 2016 bill that limited a host to listing just a single address on Airbnb and banned stays of fewer than 30 days. These measures essentially eliminate professional hosts from taking long-term rentals from locals. San Francisco and Portland, Oregon, have similar “one host, one home” policies. A study conducted by Ralph Siebert and Zaiyan Wei, professors of economics and management, respectively, at Purdue University, found that the policy reduced rents and home values in these cities by an average of 3 percent. “With the restriction, people stopped buying properties from the local markets, or they put more properties back to the long-term rental market,” Wei told Vox. He expects the new NYC law to have a sizable impact on rents and home values.
Other cities and towns require hosts to register their short-term rentals and pay a fee, but they don’t put a residency requirement or limit how long the property can be rented out as an Airbnb. In some cases, enforcement of new regulations is delayed as Airbnb and hosts fight back. To block short-term rental restrictions in San Francisco, the company spent over $8 million; it sued the city of New York in an attempt to stop the latest restrictions from going into effect and allegedly rallied hosts to lobby the city.
As for what’s needed to win back customer goodwill, that’s simple: “Economics will win here,” says Lambert. Hosts that keep their nightly rates too high won’t get the number of bookings they need to be profitable, and could simply exit the short-term rental market.
Yet Airbnb keeps pushing for more hosts to join. It was a core goal of a shareholder letter released earlier this year, with the company stating that it wanted to turn hosting “mainstream.” “Look at their earnings reports — their only strategy is increasing listings on the platform,” says Wright. It has been working, but it’s also exacerbating some hosts’ struggle to stay in business. More listings while demand slows might mean lower nightly rates, but even if Airbnb prices do come down, there’s no indication Airbnbs will ever return to being the cheaper, cozier alternative to hotels.
“The economics for Airbnb and for hosts are very different,” says Lambert. For the company, it’s probably a good thing to have as many hosts as possible. For hosts, the opposite is true.
It’s a predictable arc seen among some of the biggest tech companies of the past decade, such as Uber or Netflix. At first, affordability and convenience won over customers, but many have similarly soured on these services when the companies raised prices.
“When Airbnb rolled out, everybody thought it was going to kill hotels,” says Lambert. “And it really just became hotels.”
MAGA Republicans took down the last GOP speaker. Now they’ve passed an aid package tailored to their goals.
Although Rep. Mike Johnson was a relative unknown when he took the House speakership, one of the few things that’s quickly become apparent is how closely aligned he is with the MAGA wing of the party. He’s made that obvious in his first major legislative action: an aid package for Israel that advances far-right priorities, including antipathy for the IRS and aversion to Ukraine funding.
As various reports have documented, Johnson was one of the House members who previously voted to overturn the 2020 election results, and has long espoused hardline positions opposing LGBTQ rights and abortion rights. He’s also, as the Israel bill demonstrates, willing to continue advancing the goals of the party’s right flank.
Johnson’s Israel aid package contains $14.3 billion in support for Israel amid its ongoing war with Hamas. But it does not contain new money for the war in Ukraine, border security funding, and security aid for Taiwan. President Joe Biden, Democratic Senate leaders, and Senate Minority Leader Mitch McConnell wanted to fund all those priorities in a single legislative package, and they’ve opposed decoupling them. (Johnson has stated that he’s not against more money for Ukraine, but that he’d rather tackle that question in a separate package unrelated to Israel.)
The bill passed the House on Thursday night. Democrats overwhelmingly opposed the bill, though 12 staunch allies of Israel voted for it. Republicans nearly unanimously supported it. But the measure is dead on arrival in the Senate, amid opposition from leaders of both parties, and from the White House.
As well as decoupling aid to Ukraine and Taiwan from support for Israel, the House bill would also cut funding allocated to the IRS through the Inflation Reduction Act. Additionally, Johnson’s bill does not contain humanitarian aid for Gaza, which Biden has also requested.
Several of these provisions echo longstanding conservative demands.
For months, the GOP has steadily begun to turn against additional aid to Ukraine as former President Donald Trump has called for conditioning further funding on federal agencies providing information about the Biden family’s business practices and reiterated his “America First” isolationist approach to foreign policy. Once, only a smaller group of Republicans, led by the likes of Reps. Matt Gaetz and Marjorie Taylor Greene, were willing to speak out on the record against more Ukraine funding. Recent House votes on the subject, however, suggest opposition to Ukraine aid is only growing among members of the party.
In July, 70 Republicans voted for an amendment to the annual defense bill that would prohibit more US military funding to Ukraine. In September, that number went up, with 93 House Republicans voting in favor of a similar amendment to the Pentagon appropriations bill.
Anti-Ukraine sentiment is spreading in the Senate as well. McConnell has made a public relations push in recent weeks to try to convince his caucus of the need for more Ukraine aid. His rhetoric doesn’t appear to be having much effect, with Sen. Rand Paul (R-KY) calling McConnell’s plans “out of touch,” and McConnell deputy Sen. John Thune (R-SD) noting that despite McConnell’s best efforts, “We have a number of our members who are not for Ukraine funding.”
Much like his desire to uncouple Israeli aid from other foreign policy initiatives, Johnson’s plan for paying for the Israel package has its roots on the far right. The legislation seeks to go after Biden’s Inflation Reduction Act, a measure Republicans have often railed against for its investments in green energy tax credits, health care, and the IRS. Specifically, the bill would reappropriate funding originally meant to go to the IRS — an agency that’s been the subject of the GOP’s anti-government sentiment and past allegations of bias.
The GOP has tried repeatedly to roll back the Inflation Reduction Act’s $80 billion in funding to the IRS, which they misleadingly claim is going to be used to hire tax agents to harangue everyday Americans — including at gunpoint, some on the far right have incorrectly stated. In reality, the funding is intended to boost the agency’s ability to track down wealthy individuals who’ve failed to pay their taxes, to improve its IT capabilities, and to replace a retiring workforce. About 1 percent of those new jobs are expected to have a law enforcement component, and may require employees to carry firearms, though few ordinary Americans are likely to come across an armed IRS official.
Defunding the IRS has nevertheless become a goal of many on the right, and the new Israel bill would directly contribute to that.
Johnson has claimed that repurposing the IRS funds is a fiscally responsible “offset” and a way to address America’s most pressing immediate needs, like providing Israel military assistance without having to spend too much. However, the Congressional Budget Office actually estimates that the measure could add $26 billion to the deficit because it would reduce the revenue the IRS is able to bring in over the next decade. The IRS, meanwhile, says the Israel bill would actually cost the government $90 billion in that same timeframe.
The Israel package is just one bill. But it does highlight how Johnson could lead as speaker and which priorities he may spotlight in this role. He’s also made other comments — including claiming that it’s “very likely” Biden has committed impeachable offenses, which Republicans don’t have evidence of. Collectively, these statements and policies point to how he’ll lead.
The legislation is dead on arrival in the Senate
The fact that the Israel aid bill has no chance of making it through the Senate, where both Democrats and some Republicans — including Senate Minority Leader Mitch McConnell — would oppose it, further suggests it’s meant more as a messaging vehicle than a serious piece of legislation.
Senate Democrats and a number of more centrist Republicans have said they’re interested in seeing an aid package including both funding for Israel and Ukraine, as well as humanitarian aid for Gaza. Biden’s original request contained $61 billion in funding for Ukraine aid, $9 billion in humanitarian aid for Israel, Gaza, and Ukraine, and $7.4 billion in security aid for Taiwan and other countries in the Indo-Pacific region, in addition to $14.3 billion in military aid for Israel.
“Speaker Johnson and House Republicans released a totally unserious and woefully inadequate package that omitted aid to Ukraine, omitted humanitarian assistance to Gaza, no funding for the Indo-Pacific, and made funding for Israel conditional on hard-right, never-going-to-pass proposals,” Senate Majority Leader Chuck Schumer said in a floor speech this week.
Democratic lawmakers have also opposed plans to use existing IRS funding for Israel aid and argued that it’s an attempt to defund the agency’s efforts to go after wealthy tax cheats. Because the IRS has been underfunded for years, it hasn’t had the resources to fully enforce tax law against those with the means to evade it. Were the IRS able to pursue such actions effectively, it could result in substantial new revenue for the federal government. In September, the IRS announced that it’s launching an effort targeting 1,600 millionaires — and procuring back taxes from them — using some of the new funds it’s received from the IRA.
“House Republicans are setting a dangerous precedent by suggesting that protecting national security or responding to natural disasters is contingent upon cuts to other programs,” House Appropriations Chair Rosa DeLauro (D-CT) said in a statement.
Johnson’s Republican bill puts the House and Senate on a collision course in the coming weeks, and foreshadows what future fights between the two chambers could look like over other must-pass bills. It’s not yet clear whether Johnson will look to take a more moderate stance as time goes on, especially on issues like keeping the government open. But if he continues to embrace conservative priorities and related positions, Congress will likely struggle to pass those bills as well.