New Frontier Group US Healthcare Update – Q3 2025

The Current Landscape: Tariffs And Other Added New Pressures

In our Q2 Newsletter released in June, we highlighted how higher tariffs could reshape the cost curve for US healthcare. Since then, the impact has only become more visible. Tariffs on medical devices, imaging equipment, and certain pharmaceuticals are inflating procurement costs for hospitals, who then pass them directly to insurers.

For travelers, expats, and IPMI members entering the US, this likely means higher charges for items like diagnostic tests, hospital stays, and procedures, often with little advance notice. Similar to the air ambulance sector, where aircraft parts and staffing costs have surged, insurers face a ripple effect that ultimately raises claim severity.

Below our team has outlined some of the key factors driving costs this quarter and their impacts on the international inbound to US market.

Regulatory Shifts Driving Medical Inflation and Uncertainty

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

• CMS Reimbursement Updates – Recent Medicare and Medicaid rules are adjusting provider payment schedules upward, particularly for specialty care and prescriptions.
  • Likely Impact for International Inbound to US: These provider payment increases may cause inflated bills, as providers benchmark network negotiations from government payment schedules.
• Price Transparency Challenges – Despite federal requirements, fewer than a quarter of US hospitals fully comply with price transparency laws, leaving payers with little visibility into cost variability.
  • Likely Impact for International Inbound to US: This lack of transparency can expose 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 allowing providers to command higher prices.
  • Likely Impact for International Inbound to US: This consolidation can mean fewer provider options and higher costs for treatments.
• Tariff Volatility and Political Uncertainty – The new US policy shifts and any escalation in trade disputes could further inflate the cost of devices and drugs.
  • Likely Impact for International Inbound to US: Ongoing shifts can create unanticipated changes to billing practices to pay for higher device ad supply cost which is complicating price estimates and actuarial models.

Broader Market Pressures Driving Medical Inflation and Uncertainty

Several business factors are adding to inflationary pressure including:

• Labor 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, along with potential delays in care.
• Pharmaceutical Inflation – GLP-1 drugs and other specialty medications remain key inflationary drivers, often outpacing general 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, much of which ends up embedded in claims.
  • Likely Impact for International Inbound to US: International patients are particularly vulnerable to hidden or unnecessary charges that increase final bills.
• Travel & Assistance Costs – Demand for medical 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 or repatriation may face steeper transport costs into or out of the US.

How NFG Cost Management Mitigates Risk Factors

At New Frontier Group, we recognize that cost inflation is not a single-factor issue. It’s the convergence of tariffs, regulatory shifts, provider consolidation, and labor shortages. Our role is to shield international insurers from these headwinds while maintaining quality outcomes for members. We do this by monitoring closely as legislation passes and focusing on updates into our product models. Especially the following services:

• Bill Review & Audit – We identify tariff-related surcharges and inflated charges in billing, audit out waste and negotiate additional reductions in fees.
• Telehealth Integration – Reducing avoidable ER visits, unnecessary admissions, and costly evacuations through rapid virtual care and second opinions.
• Care Navigation – Steering members to transparent, cost-effective providers even in consolidated markets.
• Air Ambulance & Evacuation Coordination – Ensuring safe transfers with transparent cost breakdowns, avoiding unsustainable markups.
• Data-Driven Analytics – Benchmarking claims to identify outliers and highlight emerging inflationary trends.

Medical inflation continues to be shaped by a volatile mix of tariffs, regulation, and business practices. For insurers, the question isn’t whether costs will rise—but how to manage them effectively. NFG’s independence and expertise provide the flexibility to adapt quickly and deliver measurable savings without compromising on member care

To discuss these trends in more detail, contact us.