After reading the opinion piece “Alaska’s healthcare crisis starts with the price of care,” I feel compelled to respond to its conclusion that hospital costs are the driver of unaffordable healthcare in Alaska, and its convenient position that insurers are passive bystanders merely paying the bills.
Yes, Alaska’s per capita healthcare expenditures are higher than the national average. As we all know, virtually all costs in Alaska are higher than in the Lower 48 due to our unique geography. However, that is only one data point in a highly complex system that includes hospitals, providers, insurers, pharmaceutical companies, tech companies and regulators. When it comes to healthcare affordability, we need to ask the more relevant question: How does Alaska compare to the rest of the country in terms of cost growth — meaning, are we getting better or worse?
The Kaiser Family Foundation publishes extensive healthcare data, including per capita healthcare expenditures by state through 2020. Looking at the most recent five-year period, 2015-20, healthcare spending per capita in Alaska grew slower than the national average in four of those five years.
Over that same five-year period, Alaska’s per capita spending on hospital care, which the op-ed blames for high insurance premiums, grew slower than every other state in the nation. The five-year average of Alaska’s year-over-year growth in per capita hospital spending was 0.2%. This is well below the 4.6% national average and even further below rate increases from Premera Blue Cross.
I have worked with Premera Blue Cross on complex problems before. Last year, we closely collaborated and compromised to achieve meaningful change on an issue that affects patients and providers across our state: prior authorization reform. Together, opposing forces helped draft and pass legislation that made healthcare better.
That is the kind of partnership we need to pursue again now. Solving Alaska’s healthcare challenges requires acknowledging the vast, complex realities unique to our state — not pretending they can be reduced to a single scapegoat. It also requires actionable solutions we can take to address affordability.
In that spirit, Alaska’s hospitals extend our commitment to work with all parties to pursue solutions, and here are some places we can start.
Invest in primary care
The top 20% of Medicaid recipients by cost in Alaska account for 81% of total Medicaid spending in the entire program. The average Medicaid spending per person without a diagnosis of a chronic condition was $4,581 in 2024, while the average spending per person diagnosed with one or more chronic conditions was six times higher, at $26,499. Let’s increase payments to primary care to incentivize enhanced care management of these chronic conditions and other complex needs.
Tackle the gridlock challenge
In Alaska, one out of every seven hospital beds is tied up with individuals who no longer need hospital care but remain stuck because there is no available next level of care. This gridlock is the result of many factors, including workforce shortages, a lack of services for complex needs, delays in Medicaid processing and eligibility, homelessness and the lack of guardianship or healthcare proxy designations.
In 2023, we calculated a conservative impact of $188,025,658 from this gridlock — tens of millions of dollars in costs that effectively go unpaid and get absorbed throughout the entirety of the healthcare system, driving up costs for all Alaskans. It is unconscionable to allow this to continue. We all need to take ownership and work collectively to help these Alaskans move safely and efficiently through their healthcare journey.
In closing, Alaska’s hospitals are deeply invested in our communities. We stand committed to addressing affordability and invite all leaders and stakeholders to join us in a collaborative pursuit of solutions.
Jared C. Kosin, JD, MBA, is the president and CEO of the Alaska Hospital & Healthcare Association.
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