The growth rate of healthcare spending among those with private, employer-sponsored health insurance rose 4 percent in 2012, slightly lower than the previous year, but with more dollars spent on outpatient care and out-of-pocket expenses, according to the Health Care Cost Institute.
Price and use also expanded for generic prescription drugs, said HCCI in its “2012 Healthcare Cost and Utilization Report” released today.
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Healthcare spending averaged $4,701 per person with employer-sponsored coverage in 2012, $181 more than 2011. The report analyzed de-identified private insurance claims data of individuals under age 65 from 2009 through 2012 from Aetna, Humana and UnitedHealthcare.
Most of the dollars spent on health are have historically been spent on professional procedures and inpatient care, the report said. “That trend appears to be changing as more dollars are on outpatient care,” the report noted.
Price increases – and not service use – were the primary culprits for spending growth for outpatient and inpatient facility claims. Prices rose 5.4 percent for inpatient services and 5.6 percent for outpatient services.
Of all medical services, inpatient spending grew the slowest at 2.4 percent due to lower hospital admissions, while spending on outpatient services accelerated at the fastest rate at 6.5 percent, the report said. For example, the price of a visit to the emergency room averaged $2,457, and the price for other outpatient services, such diagnostic imaging, averaged $192.
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While inpatient spending had the slowest growth, the prices for inpatient services rose 5.4 percent, averaging $16,421. The highest spending for major categories was for musculoskeletal disorders and circulatory conditions.
Spending per capita on prescription drugs and devices picked up speed after a three-year slowdown, up 3.8 percent in 2012, on expanded use and rising prices for generics. Prices for generic prescriptions increased 5.3 percent in 2012, the report said. Generics expanded in use also, accelerating 8 percent from 2011. As a result, spending on generics jumped by 13.5 percent in 2012, rising $33 to $277 per person. Brand name prescription spending fell 0.6 percent on a 20.7 percent decline in their use.
Out-of-pocket spending continued higher unabated, with consumers bearing 16.3 percent of all healthcare costs in 2012, an average of $768 per person on copays, coinsurance and deductibles, which was $35 more than in 2011. Nearly half (43.4 percent) of out-of-pocket dollars were spent on professional procedures, such as doctor visits and lab tests, the report noted. A quarter (25.9 percent) of consumer dollars were spent on outpatient services.
Although average healthcare expenditures grew at nearly the same rate in 2012 as 2011, the reasons were different, said David Newman, HCCI executive director, in a news release announcing the report. “In prior years, rising healthcare prices drove up spending,” he said in the release. “In 2012, we saw utilization start to change healthcare trends for prescription drugs and professional procedures. Preliminary evidence suggests this may be indicative of a larger shift in care as people search for lower cost care alternatives.”
Regional spending variations persisted. Per capita spending on healthcare was highest in the Northeast ($4,868) and lowest in the West ($4,382). Consumers in the Midwest and South spent the highest amounts of their own dollars on healthcare ($801 and $834 per person, respectively). Out-of-pocket spending also grew the most in the Midwest and South (5.5 percent for each) for the third consecutive year.
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