Has the Argument that Overuse Drives Health Care Costs Just Been Turned on its Head?
|May 21, 2012||Posted by M. P. under Behavorial Health, Drug and Alcohol, Health||
Price increases, not increased utilization, are a primary factor behind higher health care costs according to a report from the Health Care Cost Institute (HCCI) an independent, nonprofit organization formed in 2011 as a clearinghouse of sorts for data related to health care costs and utilization in the United States.
The paper, Health Care Cost and Utilization Report: 2010, presents trends in health care cost and utilization for persons younger than 65 covered by an employer sponsored, private insurance plan during 2009 and 2010. Findings include,
- Out-of-pocket spending by plan beneficiaries rose by just over 7 percent in 2010 for all service categories, ranging from a 3 percent increase for prescription drugs to a 10 percent increase for outpatient services.
- The average price for a visit to the emergency room rose 11.0 percent between 2009 and 2010 – from $1,195 to $1,327.
- Between 2009 and 2010, prices increased for nearly all inpatient, outpatient and specialty visits, admissions and procedures, including – mental health and substance abuse inpatient admission (8.6 percent), outpatient surgery (8.9 percent) and an office visit to a primary care provider (5.3 percent). The average price of an admission to a skilled nursing facility declined by 3.2 percent during the same time period.
- Utilization rates decreased for inpatient admissions (medical 5.2 percent, surgical 4.9 percent), emergency room visits (5.3 percent), and primary care provider office visits (5.2 percent).
- Utilization rates increased for mental health and substance abuse inpatient admissions (5.0 percent), skilled nursing facility admissions (7.2 percent), and outpatient observation (5.3 percent).
Overall, the data indicate that utilization rates decreased while prices increased. The paper also calls for a closer examination of variations in hospitals costs, including the possibility of cost shifting; and why mental health and substance abuse services increased more than other areas of healthcare in inpatient utilization, average lengths of stay and cost between 2009-2010. I’ll be keeping an eye on future analysis from HCCI, after all, more and better information on healthcare utilization and pricing might bring a bit of transparency to the debate on what is driving the ever-growing cost of healthcare.