Health care spending for working Americans reaches all time high
Per-person spending reached $6,000 in 2019, driven predominantly by price increases
Reports and ProceedingsWASHINGTON (October 5, 2020) — Average annual health care spending for individuals with employer-sponsored insurance (ESI) rose 2.9% to $6,001 per person in 2019, according to the Health Care Cost Institute’s annual Health Care Cost and Utilization Report. Between 2015 and 2019 spending increased by 21.8% or $1,074 per person. While prices continued to grow each year, utilization of health care services declined slightly in 2019, leading to slower year-to-year spending growth.
“While most of the world’s focus appropriately remains on the COVID-19 pandemic, the fact remains that health care spending in the US continues to grow at unsustainable rates” said Niall Brennan, president and CEO of HCCI. “Unit price increases continue to drive increases in spending. Hospital prices increased by almost 31% from 2015-2019, leading to a 14.4% increase in spending despite a 12.5% decline in hospital utilization.”
Despite recent increases in use, changes in the mix of services, and demographic shifts, rising prices remain the primary driver of spending growth between 2015 and 2019 - responsible for nearly two-thirds of total per-person spending growth.
The report examines four groups of health care services. Of the four major categories, outpatient visits saw the highest spending increase from 2015 to 2019 (31.4%). Other notable trends include:
- Professional services.
- Spending per person increased 14.8% over 5 years.
- Prices increased 10.5% while the utilization of professional services increased 3.9% over 5 years.
- Inpatient spending.
- Spending per person on inpatient admissions rose 14.4% between 2015 and 2019, though the 2019 spending growth was lower than previous years due to declining utilization.
- Prices for inpatient admissions grew 30.8% over 5 years, the highest price increase of any service category.
- Outpatient
- Increases in prices and use led to a 31.4% increase in spending over 5 years.
- Prices increased 22.5% while the utilization increased 7.3% over 5 years.
- Prescription Drugs
- Spending on prescription drugs increased 28.4% over 5 years.
- Prescription drugs was the only service category that saw utilization grow faster than prices from 2015 to 2019. Point-of-sale prices for prescription drugs increased 13.0% while utilization increased 13.6% over five years.
Out-of-pocket spending increased $91 per person over 5 years. Half of the out-of-pocket spending in 2019 was for professional services. Study authors stressed that the analysis does not consider other potential out-of-pocket costs related to health care.
Methodology. Since 2011, HCCI has tracked, independently analyzed, and reported health care spending, utilization, and prices each year in its Health Care Cost and Utilization Report, using deidentified claims data of people up to age 65 with employer-sponsored health insurance. HCCI analyzed data from more than 2.5 billion medical and prescription drug claims for approximately 55 million individuals annually between 2015 and 2019. Claims data come from CVSHealth/Aetna, Humana, and Blue Health Intelligence — representing one-third of the employer-sponsored insured population. Measures of drug spending reflect discounts negotiated from the wholesale price of drugs but do not include manufacturer rebates that are provided through separate transactions. Thus, drug prices reflect the point-of-sale prices. Nationally, Black and Hispanic populations are underrepresented in employer-sponsored insurance. The racial and ethnic distribution of the population in HCCI’s data is similar to the national employer-sponsored insurance population, as such health care spending and use among these individuals are likely under-represented in the findings in this report.
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About the Health Care Cost Institute
The Health Care Cost Institute’s mission is to get to the heart of the key issues impacting the U.S. health care system — by using the best data to get the best answers. HCCI stands for truth and consensus around the most important trends in health care, particularly those economic issues that are critical to a sustainable, high-performing health system. Launched in 2011, HCCI currently holds one of the largest databases for the commercially insured population, and in 2014 became the first national Qualified Entity (QE) entitled to hold Medicare data. Academic and government researchers interested in licensing our commercial data can learn more at https://healthcostinstitute.org/dataaccess-hub. For more information, visit healthcostinstitute.org or follow us on Twitter @healthcostinst.
When a free cancer check finds something, could cost keep patients from following up?
Two new studies show potential out-of-pocket costs for tests in patients after initial screening for lung and cervical cancer
Peer-Reviewed PublicationEleven years ago this month, the scans and exams that hold the most power to spot the early signs of cancer became available for free to many American adults.
Now, two new studies show that when those screening tests reveal potentially troubling signs, patients could face hundreds of dollars in costs for follow-up tests.
The studies, by teams from the University of Michigan and Duke University, could inform efforts to ensure that patients follow up on abnormal test results and don’t delay care due to cost. Such delays could lead to cancer going undiagnosed and progressing, potentially leading to worse patient outcomes and high medical costs.
The studies look at out-of-pocket costs billed to older adults who had CT scans to screen for lung cancer, and to women after an abnormal Pap smear or cervical exam.
The first paper, led by radiologists Tina Tailor, M.D., from Duke and Ruth Carlos, M.D., M.S. of U-M’s Michigan Medicine, looks at what patients were billed for the lung biopsies and other invasive procedures used to follow up on an abnormal lung CT scan. It’s published in the Journal of the American College of Radiology.
In all, 7.4% of the patients who had a lung cancer screening CT went on to have at least one follow-up invasive procedure. While 20% of this group was diagnosed with lung cancer, the rate of procedures “downstream” of the screening CT is higher than what was seen in the clinical trials of this type of screening. Such studies established the value of lung CT screening in certain older adults and led to no-cost access in 2013.
Over half of the patients who had a procedure after their lung scan were asked to pay something, sometimes hundreds or even thousands of dollars out of their own pockets. Forty percent paid nothing for their follow-up care.
Now that more American adults are eligible for free lung cancer screening, due to new evidence about its ability to spot disease early, the authors say insurers may want to consider ways to reduce the cost burden on those with abnormal scans who need follow-up care to determine if cancer is present.
The second paper, published in the journal Obstetrics & Gynecology by a team led by U-M internal medicine professor A. Mark Fendrick, M.D., and OB-GYN assistant professor Michelle Moniz, M.D., M.Sc., looks at what women paid out of their own pockets for a type of cervical exam called colposcopy. Conducted after a Pap smear, HPV test or routine cervical exam gives abnormal results, a colposcopy can include a biopsy or other procedures.
Women who had a colposcopy without further procedures paid an average of $112, while those who had cells taken for further examination paid $155 on average. Those who had further procedures faced hundreds of dollars more in costs -- and this out-of-pocket cost rose sharply during the 13 years studied. By 2019, a woman who had additional care beyond a biopsy could expect to face a total bill of nearly $1,000.
“Costs much lower than these have been shown to prevent women from obtaining recommended healthcare,” said Moniz. “So it is high time we consider eliminating financial barriers to recommended care to prevent cancer.”
“The Affordable Care Act requires enhanced preventive care coverage for over 150 million Americans, including initial screening tests for breast, cervical, colorectal and lung cancer.” said Fendrick. “Since screening for these cancers often requires multiple steps, health insurers should remove barriers that may create financial hardship or deter an individual from completing the screening process.”
Carlos, Fendrick and Moniz are members of the U-M Institute for Healthcare Policy and Innovation. Fendrick directs the Center for Value-Based Insurance Design.
JOURNAL
Obstetrics and Gynecology
METHOD OF RESEARCH
Data/statistical analysis
SUBJECT OF RESEARCH
People
ARTICLE TITLE
Out-of-Pocket Costs for Colposcopy Among Commercially Insured Women From 2006 to 2019
ARTICLE PUBLICATION DATE
29-Sep-2021
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