Understanding U.S. Health Care Spending [08-24-11]

Filed under: Industry Updates — Editor @ 1:48 pm

In July, the National Institute for Health Care Management released its report on Understanding U.S. Health Care Spending. The Key Points of the report included:

  • U.S. spending for health care has been on a relentless upward path – reaching $2.5 trillion in the aggregate, $8,100 per person, and 17.6 percent of GDP in 2009.
  • Spending is highly concentrated among a relatively small portion of high-cost users, with just 5 percent of the population responsible for almost 50 percent of all spending. At the other end, half of the population accounts for just 3 percent of spending.
  • As more people are being diagnosed with and treated for chronic conditions, including many linked to rising obesity rates, high health spending has spread to a larger segment of the population. The spending distribution remains highly concentrated, however.
  • Higher spending for hospital care and physician and clinical services accounted for half of the increase in total national health spending between 2005 and 2009 and more than 80 percent of the increase in private insurance premiums over the period.
  • Rising prices per unit of service have played a larger role than rising utilization rates as a determinant of recent expenditure growth.
  • Key drivers of rising unit prices and higher utilization include advances in medical technology, rising treated prevalence rates for chronic diseases, and increased provider consolidation and market power.

You can read the entire report here.   NIHCM-CostBrief-Email

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