Employer-Sponsored Health Plan Cost Index

Turven Health Analytics has a large claims database dating back to 1990 covering people under the age of 65 in employer-sponsored health plans.   The company recently released a report on spending trends among that group.   (Truven Report)   Over the period from 2003 to 2013, per capita spending grew 5.2%.  The highest rate of expenditure, $8175, is seen among 45 to 64 year-olds, but their compounded growth rate was only 4.1%.   The youngest cohort, 0 to 17 year olds, had the highest growth rate at 6.5%, but a much lower per capita spend.  Among broad categories, outpatient spending is both the largest and the fastest growing, at a compounded 6%.  Looking more at the location of care, hospital services, and in particular, hospital outpatient services, are the fastest growing, at 6.2% compounded.  As other research has shown, the Truven report finds that the employee share of spending via out-of-pocket costs is growing more rapidly than overall spending, at 5.7%, reaching $762 in 2013.

In more recent quarters, spending among 45-64 year-olds has begun to increase faster, and is currently growing at a rate faster than that of the younger cohorts.  In late 2013 and early 2014, prescription drug spending sharply accelerated, due to hepatitis C and other expensive specialty drugs.  Hospital spending, on the other hand has decelerated.  The Truven report suggests that some of the reduced growth rates in recent quarters was due to older employees deferring utilization due to greater cost-sharing in high-deductible plans, but that as the recovery takes firmer hold, they may be engaging in some of that deferred care.  Because so many Americans are covered by employment-related health insurance, trends in that coverage are particularly noteworthy.