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HCCI Report on 2015 Health Spending

By December 1, 2016Commentary

There are lots of reports on health spending in Medicare and thanks to the Health Care Cost Institute we have a fairly comprehensive look at spending and spending trends for commercial insurance.  This year’s annual report included the Kaiser plans, which is a significant addition.  (HCCI Brief)   Spending per capita in the population captured in the HCCI data grew to $5141 in 2015, up 4.6% from 2014.  This is a significantly higher growth rate than 2014’s 2.6% and 2013’s 3%.  Per capita out-of-pocket spending rose to $813, 3% higher than in 2014.  Out-of-pocket spending was 15.8% of total spending, a decline from previous years, which is a surprise given the ongoing growth in high-deductible plans.  Unit price increases were the predominant factor in spending growth, as they have been in recent years.  For example, miscellaneous outpatient utilization rose 1.5% while prices grew 2.7% and ambulatory professional service use increased .2% while prices rose 3.5%.  Drug prices and utilization significantly contribute to overall spending rises.

From 2012 to 2015, office visits to primary care physicians declined on a per 1000 people basis, while visits to specialists rose.  Er visits had a slight drop from 180 per 1000 people to 173.  General hospital admissions declined while mental health ones stayed steady.  Average spending per woman was over $1000 higher than that for men, but men’s spending is growing slightly faster than women’s.  As you would expect, per capita spending rises by age cohort.  For those aged 55 to 64 it was $9707 and for those aged 19 to 25 it was $2915.  But the younger groups are showing somewhat faster spending increases.  There is varying differential spending across service categories by age and sex.  For example, men tend to spend more on inpatient services, but women more on outpatient ones.  Geographically, spending is highest in the Northeast and lowest in the west.  In total, professional outpatient accounted for 33.8% of spending, inpatient for 19.4%, outpatient for 17.3% and drugs around 19%.

This HCCI report does not indicate ranges or skewedness of spending.  That would be very interesting.  Survey based studies of national health spending suggest spending across the population is very concentrated in a relatively few people.  If the same is true in the commercial population it would suggest new directions for health coverage for that population.

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