October 28, 2014: The fourth annual health care cost and utilization report from HCCI

Contact:
Jemma Weymouth, 301-280-5706
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New Report: Spending Per Privately Insured Grew 3.9% in 2013, as Falling Utilization Offset Rising Prices

 Out-of-pocket Spending for Young Adult Women Remained Flat; Antidepressants accounted for 10% of all generic drug use

Washington DC – Privately insured Americans spent more on medical services in 2013 even though they used fewer of them, according a new report by the Health Care Cost Institute. Spending per enrollee in employer health plans grew by 3.9%, continuing the moderate growth trend that began in 2010. But falling utilization helped mask continued growth in health care prices.

In the 2013 Health Care Cost and Utilization Report—an annual study of health care price and utilization trends for Americans younger than age 65 participating in employer health plans—HCCI finds that health care spending averaged $4,915 per enrollee in 2013, up $185 from the year before.

Out-of-pocket costs, including co-payments and deductibles paid directly by consumers, remained stable as a percentage of overall health spending. A companion issue brief, Out-Of-Pocket Spending Trends (2013), details these trends by demographic groups and service category.

“Price growth for medical services and brand name drugs remained strong in 2013,” said HCCI Executive Director David Newman. “Health spending grew moderately, but that was only because consumers used fewer services.”

Health Care Prices Jumped As Use of Costly Services Fell
Use of brand prescription drugs, inpatient admissions, and outpatient services declined in 2013. Yet average prices increased for all three categories, and at higher rates than in 2012.

  • Inpatient services. Acute inpatient hospital admissions fell 2.3% while prices rose 6.7%, causing overall inpatient spending to rise by 3.8%. The average price per-admission grew by $1,067, in 2013 to $18,030.
  • Outpatient services. Outpatient visits declined by 0.8% while prices rose 6.4%. Total outpatient visit spending grew 5.5%.
  • Brand name drugs. Use of brand name prescriptions (filled days per 1,000 insureds) dropped by 15.5% while the average price per filled day increased more than 21.2%. Total spending on brand name drugs grew 2.4%.

Use of professional services, including office visits and lab tests, increased in 2013, as did the use of generic prescriptions (4.5%). Preventive visits to primary care physicians and contraceptive hormone use both rose 5%. Antidepressants dominated generic prescription drug use, accounting for over 10% of all generic drugs used in 2013.

No Increase in Out-Of-Pocket Spending for Young Women
In 2013, consumers spent an average of $800 per person out-of-pocket—a 4% increase over 2012. Young women, ages 19-25, spent an average of $662 out of pocket, the same amount as the year before. This was almost completely due to a drop in out-of-pocket spending on generic and brand hormone contraceptives. Hormone contraceptives generally are covered without cost sharing, a provision of the Affordable Care Act that went into effect January 1, 2013.

“This is the first time we have seen flat out-of-pocket spending growth by any group of the privately insured,” said HCCI Senior Researcher Amanda Frost.

In 2013, out-of-pocket spending went up for medical services, especially for acute inpatient admissions, but went down for both brand and generic prescriptions.

Other key findings highlight the notable differences in spending and health care use by age, region and gender, including:

  • Before Age 55, Women Use More Health Care than Men: In 2013, adult women (ages 19-54) had higher levels of outpatient and professional service use than adult men. But after age 54, the gender gap in use of these services narrowed, as use of radiology, laboratory, and pathology services by men increased.
  • Emergency Room Spending Similar Across Age Groups Despite Differences in Use:Young adults visited the ER more often than older adults. However, older adults had a higher average price for their visits, due partially to use of more intensive care. As a result, dollars spent on emergency room visits were similar across those age groups. Spending on ER visits averaged $314 per capita for older adults, compared to $310 per young adult.
  • Antidepressants account for 10% of all generic drug use. CNS agents, drugs that affect the brain and spinal column, accounted for 27.1% of the generic filled days in 2013. Antidepressants were the most commonly filled class of CNS generic prescriptions and the most used generic drug class for young adult men, intermediate adult men, middle age adult women, and pre-Medicare adult women.

HCCI’s analysis is based on de-identified Health Insurance Portability and Accountability Act (HIPAA) compliant claims data from three of the nation’s largest health insurance providers. For this report, the HCCI examined claims for nearly 40 million Americans covered by ESI per year, which accounted for more than 27% of the nation’s privately insured population in 2013. HCCI does not report on premiums. All price and spending trends reported by HCCI are current or nominal dollars.

The companion studies, 2013 Health Care Cost and Utilization Report and Out-Of-Pocket Spending Trends (2013), are available on the HCCI Website.

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About the Health Care Cost Institute
The Health Care Cost Institute was launched in 2011 to promote independent, nonpartisan research and analysis on the causes of the rise in U.S. health spending. For more information, visit www.healthcostinstitute.org or follow us on Twitter @healthcostinst.

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