It's the prices.
If you are looking for one of the main reasons why health care spending continues to grow, a new report offers another reminder. Americans are using less care but paying more for it because of rising prices, especially for prescription drugs, surgery and emergency department visits.
Over a five-year study, 2012-2016, by the Health Care Cost Institute, prescription drug spending experienced cumulative growth of 27 percent, despite a flat or decreasing trend in generic drug prices and a decline in use of brand name drugs.
While the number of emergency room visits rose just slightly, the average price for an emergency room visit grew steadily for a 31.5 percent cumulative increase, driving an increase in outpatient spending.
The study also found that the average price of surgery went up, causing increased spending for inpatient and outpatient care. The average price for surgical admissions increased by nearly $10,000 in the five years, or 30 percent, despite a 16 percent cumulative decline in use of the services.
“It is time to have a national conversation on the role of price increases in the growth of health care spending,” Niall Brennan, president of the Institute, said in a statement.
“While consumers, especially those with employer-sponsored insurance, may not feel the direct impact of these charges via out-of-pocket payments, they ultimately pay through increased premiums and decreased benefits,” he said.
Other highlights of the report included:
-- Total spending per person in the United States is growing at faster rates than prior years, with 4.6 percent growth in 2016 compared to 4.1 percent growth in 2015, after two years of sub-3 percent growth from 2012 to 2014.
-- Spending on primary care office visits fell by almost 6 percent over five years as a result of a decrease in the number of visits. But this was offset by a 31 percent spending increase on office visits to specialists and a 23 percent increase in visits for preventive care. The Institute attributed those trends partly to changes in billing practices or the way people seek care.
-- Out-of-pocket spending by patients increased every year, but at a slower rate than total health care spending as a result in a decline in the amount consumers paid out of pocket for prescriptions.
-- Prices for professional services, fees paid to doctors, surgeons, and other clinicians, saw the lowest spending growth.
The Health Care Cost Institute describes itself as an independent, nonpartisan research group focused on health spending.