38% of Millennials Pay Out of Pocket for Healthcare

Healthcare costs are hitting the youngest adults hardest, turning even routine care into a budget decision for Americans who, on paper, should need the least medical attention.

That was the central takeaway from “Healthcare on Hold: Why 1 in 4 Gen Z Consumers Skip the Doctor,” the November Generational Pulse Report from PYMNTS Intelligence based on a survey of 2,368 consumers in the United States.

Medical costs are straining household budgets across every age group, but the pressure is most acute among Generation Z, zillennials and millennials. While older consumers are more likely to use healthcare services, young adults are more likely to say those services create real financial stress, require out-of-pocket spending and lead them to delay treatment.

Key findings from the report:

Healthcare costs are at least somewhat of a financial burden for 80% of Gen Z consumers, versus 63% of consumers overall and 44% of baby boomers and seniors.

At least some out-of-pocket payment is required for 30% of healthcare visits overall, but that rises to 38% for millennials, 42% for zillennials and 35% for Gen Z. By contrast, 86% of baby boomers and seniors said their last visit was covered at least in part by insurance, compared with 70% of Gen Z.

Cost is also changing behavior, as 25% of Gen Z consumers delayed a doctor’s visit in the last three months because of cost, and 22% skipped a recommended treatment or test. Across all consumers, 18% delayed a visit and 14% skipped recommended care.

This is becoming a broad affordability issue, not a narrow insurance story, the report found. Premiums are rising, and many consumers with coverage still face out-of-pocket bills.

The strain shows up in specific parts of the system.

Out-of-pocket costs were reported in 57% of chiropractor visits, 42% of eye doctor visits and 39% of retail clinic visits. Mental and behavioral health was another pressure point. More than half of all mental health visits were conducted remotely, yet affordability remained a challenge as behavioral health costs climbed faster than many other forms of treatment.

There is, however, a constructive angle in the data. Young consumers were the most open to tools that could make healthcare easier to shop for and pay for. Gen Z was 32% more likely than the overall population to express interest in at least one new payment technology, and 39% said they want real-time tools to check insurance benefits, while 31% want artificial intelligence-powered cost prediction tools.

Consumers want clearer prices, better benefit visibility and fewer surprises. Simple tools could help.

At PYMNTS Intelligence, we work with businesses to uncover insights that fuel intelligent, data-driven discussions on changing customer expectations, a more connected economy and the strategic shifts necessary to achieve outcomes. With rigorous research methodologies and unwavering commitment to objective quality, we offer trusted data to grow your business. As our partner, you’ll have access to our diverse team of PhDs, researchers, data analysts, number crunchers, subject matter veterans and editorial experts.