The current landscape: tariffs and other added new pressures

For travellers, expats, and IPMI members entering the U tariffs on medical devices, imaging equipment, and certain pharmaceuticals are inflating costs for hospitals, who then pass them directly to insurers. Similar to the air ambulance sector, where aircraft parts and staffing costs have surged, insurers face a ripple effect that ultimately raises claim severity.

Regulatory shifts driving medical inflation and uncertainty

Several new policies are being implemented/ reviewed pushing costs higher, including:

• CMS reimbursement updates – recent CMS rules adjusting provider payment upward, particularly for specialty care and prescriptions

Likely impact for international inbound to US: provider payment increases may cause inflated bills, as providers benchmark network negotiations from government payment schedules

• Price transparency challenges – despite requirements, fewer than a quarter of US hospitals comply with transparency laws, leaving payers with little visibility into costs

Likely impact for international inbound to US: lack of transparency exposes international patients to unpredictable billing and cost shifting for common services from MRIs to surgeries

• Private equity consolidation – specialty practices in anesthesia, orthopedics, and oncology continue to consolidate at an accelerated rate, reducing competition and raising prices

Likely impact for international inbound to US: consolidation means fewer provider options and higher treatment costs

• Tariff volatility and political uncertainty – US policy shifts and escalation in trade disputes could further inflate the cost of devices and drugs

Likely impact for international inbound to US: ongoing shifts create unanticipated changes to billing practices which complicate price estimates and actuarial models.

Broader market pressures driving inflation and uncertainty

Several business factors are also adding to inflationary pressure:

• Labour costs – shortages of clinical staff, pilots, and technicians are driving wage hikes across hospitals and assistance providers

Likely impact for international inbound to US: patients may face higher provider fees tied to staffing costs, and potential delays in care

• Pharmaceutical inflation – GLP-1 drugs and specialty medications remain key inflationary drivers, often outpacing consumer price index

Likely impact for international inbound to US: expats and long-stay members may encounter significantly higher medication costs compared to their home markets

• Administrative waste – up to a quarter of US healthcare spending is tied to redundant administration, which ends up embedded in cost

Likely impact for international inbound to US: international patients are particularly vulnerable to hidden/unnecessary charges that increase bills

• Travel and assistance costs – demand for evacuations remains high, but aviation and compliance costs continue to pressure air ambulance pricing

Likely impact for international inbound to US: International members requiring evacuation may face steeper transport costs in or out of the US.

Insurers face a ripple effect that ultimately raises claim severity

How NFG cost management mitigates risk factors

At New Frontier Group, we recognise that cost inflation is not a single-factor issue – but a convergence of tariffs, regulatory shifts, provider consolidation, and labour shortages. Our role is to shield international insurers from these headwinds while maintaining quality outcomes. We monitor legislation and trends and focus on updates into our product models, especially the following services: Bill Review Audit, Telehealth Integration, Care Navigation, Air Ambulance, Evac Coordination, Data-Driven Analytics.

NFG’s independence and expertise provide the flexibility to adapt quickly and deliver measurable savings without compromising on member care.