What can be a consequence of increased administrative costs for health insurers?

Higher overall health insurance premiums can be a direct consequence of increased administrative costs for health insurers. When insurers experience higher expenses related to administration—such as processing claims, managing networks, and ensuring compliance with regulations—these costs are typically passed on to policyholders in the form of increased premiums.

Health insurers aim to maintain profitability while covering rising operational costs, and higher premiums can be a response to offset these administrative expenditures. This dynamic underscores the relationship between an insurer's operational efficiency and its pricing strategy. A focus on reducing administrative costs, such as streamlining processes or adopting technology, could help in stabilizing or reducing premiums; however, when these costs rise, it often leads to an increase in what policyholders have to pay for their coverage.

Other options reflect outcomes that would not directly result from increased administrative costs. Lower premiums, improved healthcare services, or increased patient satisfaction would generally be associated with effective cost management and efficient administrative practices rather than the adverse impact of rising administrative costs.