When physicians and even major health systems begin deciding that certain insurance arrangements no longer make financial sense, the problem becomes larger than reimbursement. It becomes a question of what having health insurance actually guarantees.
There is a peculiar contradiction at the center of American healthcare. We spend more and more money on it, and yet nearly everyone inside the system seems to feel financially squeezed. Patients pay premiums, deductibles, copays, coinsurance, and bills they often struggle to understand. Employers devote enormous sums to health benefits. Government spending on Medicare and Medicaid continues to climb. Hospitals warn about thin margins. Independent physicians describe practices strained by rising salaries, rent, supplies, technology, malpractice coverage, regulatory requirements, and administrative work. Insurers negotiate relentlessly over what they will pay. Somehow, in a system awash in money, there is a growing sense that nobody can afford anything.
A recent development at Mount Sinai Health System in New York offers an unusually visible example of this tension. On its website, Mount Sinai lists the Medicare Advantage plans with which it participates for 2026, but with notable restrictions for several of them. As of an August 4 update, the health system states that its providers are not currently accepting new Fidelis or Wellcare patients, effective August 1, and that its primary-care providers are not currently accepting new Healthfirst Medicare Advantage patients. The plans remain on Mount Sinai’s list of participating Medicare Advantage plans, making the distinction an important one: this is not a blanket refusal of Medicare Advantage or even necessarily a termination of participation in these plans. It is a restriction on accepting certain new patients within them.
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The story is easy to understand as a dispute between a hospital and insurers. It becomes more interesting when viewed alongside what has been happening in physicians’ offices for years. Independent doctors have been dropping insurance contracts, limiting the number of patients they accept under particular plans, moving toward direct-pay arrangements, joining larger systems, or leaving private practice altogether. Each decision has its own circumstances, but underneath many of them lies an increasingly uncomfortable calculation: What does it actually cost to provide this care, and does the payment received for providing it cover that cost?
That question sounds almost indecent in medicine. We prefer to imagine healthcare as existing outside ordinary economics because illness itself is not an ordinary commodity. A person with chest pain does not shop for an emergency department the way someone shops for a television. A woman with a new breast mass is not entering a conventional marketplace. Physicians have ethical obligations that extend well beyond those of most businesses, and hospitals occupy a special place in their communities. Yet every examination room still requires rent or a mortgage. Nurses and medical assistants receive salaries. Computers, EHR systems, billing staff, insurance, supplies, utilities, compliance, and cybersecurity cost money. A practice can be devoted to patients and still have a payroll due Friday.
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The pressure is especially visible in Medicare physician payment. According to the American Medical Association’s 2026 analysis, the cost of running a medical practice increased 63 percent between 2001 and 2026, while Medicare physician payment increased only 10 percent. Adjusted for inflation in practice costs, Medicare physician payment has declined roughly 33 percent over that period. The Medicare trustees have themselves warned that, without changes to payment or delivery, access to Medicare-participating physicians could become a significant long-term problem.
Meanwhile, the country is hardly spending less on healthcare. U.S. healthcare expenditures reached $5.3 trillion in 2024, according to the Centers for Medicare & Medicaid Services, amounting to $15,474 per person and 18 percent of the nation’s gross domestic product. Private health insurance spending reached roughly $1.64 trillion. Medicare spending exceeded $1.1 trillion. Out-of-pocket spending was more than $556 billion. Hospital expenditures grew to approximately $1.63 trillion, while spending on physician and clinical services reached about $1.11 trillion.
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Those numbers are difficult to reconcile emotionally with the experience on either side of the examination table. Patients hear that America spends $5.3 trillion on healthcare and reasonably wonder why their deductible is so high, why the specialist they want is out of network, or why a medication recommended by their physician requires another round of authorization. Physicians look at the same enormous healthcare economy while watching reimbursement struggle to keep pace with the cost of keeping a practice open. Hospitals negotiate contracts with insurers and sometimes conclude that the terms are unsustainable. Insurers face pressure from employers, regulators, shareholders, government programs, providers, and members to control spending. Every participant can produce a spreadsheet explaining the pressures it faces.
The result is a system in which individually rational decisions can collectively produce something that feels irrational. An insurer tries to restrain payments because healthcare costs are rising. A physician decides a contract pays too little to justify the administrative burden of participating. A hospital system decides it cannot sustainably accept certain new patients under particular plans. A patient did everything society instructed her to do: obtained insurance, paid the premium, carried the card. She calls for an appointment and discovers that the card does not necessarily open the door she expected it to open.
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This is where the distinction between coverage and access becomes increasingly important. We often use the two almost interchangeably in political discussions. How many people are insured? What percentage of the population has coverage? What benefits does a plan include? These are important measures, but an insurance policy is ultimately a financing mechanism. Healthcare requires an actual person or institution willing and able to provide the service under the terms attached to that financing. A network can exist on paper while becoming progressively harder to navigate in real life.
There is also an important question of scale. When an independent physician decides to stop accepting a particular insurance plan, we may view it as a small-business decision, especially when that physician can point to declining reimbursement and rising overhead. When a major health system makes a similar calculation, the reaction can be very different. Large health systems occupy enormous physical and civic footprints. Some are nonprofit institutions that receive tax advantages in exchange for serving broader community purposes. Patients may reasonably expect something different from them than they expect from a three-doctor practice struggling to make payroll. The obligations are not identical, even when the underlying arithmetic may look surprisingly familiar.
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It would be convenient to identify a single villain. American healthcare rarely offers that luxury. Insurers deserve scrutiny for reimbursement practices, network design, prior authorization, administrative complexity, and the enormous power they can wield over both patients and clinicians. Hospitals deserve scrutiny for consolidation, pricing, executive compensation, facility fees, and the obligations that accompany nonprofit status. Physicians should be examined when financial incentives influence clinical decisions. Government payment systems deserve scrutiny when reimbursement formulas fail to reflect the cost of delivering care. Patients, meanwhile, are increasingly expected to navigate the resulting maze as informed healthcare consumers despite being given prices, networks, and rules that can change beneath them.
The deeper problem may be what happens when enough participants decide that the arrangement no longer works for them. One physician leaving an insurance network is an inconvenience. Thousands reconsidering participation begins to look like a structural shift. One hospital renegotiating a contract is ordinary healthcare business. Major systems limiting access to particular plans raises a more consequential question about where patients covered by those plans are supposed to go.
Perhaps the most revealing thing about the Mount Sinai story is that it does not feel entirely surprising. We have become accustomed to healthcare stories in which an insurer and a hospital cannot agree, a physician leaves a network, a practice closes, a rural hospital struggles, or a patient discovers that being insured does not mean being able to see the doctor they need. Each episode arrives as a discrete piece of news, complete with statements from the parties involved and assurances that patient care remains the priority.
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Taken together, however, they suggest something larger. The American healthcare system has become extraordinarily good at moving money through an increasingly elaborate infrastructure while leaving many of the people at its endpoints wondering why the transaction feels so difficult. Patients are paying. Employers are paying. Taxpayers are paying. Government is paying. The country is spending trillions.
And increasingly, the people and institutions expected to provide the care are asking whether they can afford to take the payment being offered.
That may be the question worth watching. Because once enough doctors, practices, and hospitals decide the answer is no, the problem will no longer belong primarily to them. It will belong to everyone holding an insurance card and expecting it to mean that somewhere, on the other side of it, there will still be someone willing to provide the care.
What happens when you have insurance, pay for insurance, and then discover that the doctor you need can no longer afford to accept your insurance?
