Published on 01 June 2012
Health Care Cost and Utilization: Trends for Employer-insured Individuals Under Age 65

A new study highlights interesting health care cost and utilization trends for Americans under age 65 with employer-sponsored health coverage.

The Health Care Cost Institute (HCCI) analyzed data from Aetna, Humana, and United HealthCare, assessing price and utilization levels and changes, in their publication, Health Care Cost and Utilization Report: 2010. This is the first report to track changes in health care service expenditure and utilization by those under the age of 65 and covered by employer-sponsored private insurance. The de-identified, Health Insurance Portability and Accountability Act (HIPAA) compliant data sets acquired from the nation’s largest private insurers provide a comprehensive portrait of the privately insured.

The report looks at trends in physician and other professional services, outpatient and inpatient care, and prescription drug use along with per capita and out-of-pocket spending, prices paid per service, utilization, service mix, and intensity. The study found that, in 2010, rising prices were the top health care cost driver for the privately insured. Growing 3.3 percent, per capita health spending for those younger than 65 increased nearly thrice the rate of general inflation.

Key findings include:

  1. Health care spending increased due to price increases as opposed to changes in service mix or utilization.
  2. The fastest health care spending growth occurred for those age 18 and younger.
  3. Out-of-pocket per capita spending in 2010 grew 7.1 percent, while cost-sharing rates remained stable among beneficiary and payer.
  4. Brand name prescription drug prices increased 13 percent while generic prices decreased by 6.3 percent between 2009 and 2010.
  5. Utilization of emergency rooms, medical inpatient admissions, radiology procedures, and provider office visits decreased more than five percent in 2010.
  6. Brand name prescription quantity decreased by four percent in 2010.
  7. Generic prescription quantity increased by 2.5 percent in 2010.

HCCI plans to publish a number of new reports around spending trends including cost and utilization for mental health and substance abuse, diabetes, and cancer. The 2011 report update is slated for publication in Fall 2012.

To read or download the full report, click here (PDF).

About Author

An expert on Medicaid, Medicare, and health reform, Kip Piper, MA, FACHE, is a consultant, speaker, and author. Kip Piper advises health plans, hospitals and health systems, states, and pharma, biotech, medical device, HIT, and investment firms. With 30 years’ experience, Kip is a senior consultant with Sellers Dorsey, top specialists in Medicaid and health reform. He is also a senior advisor with Fleishman-Hillard and TogoRun. For more, visit KipPiper.com. Follow on Twitter @KipPiper, Google +, Facebook and connect on LinkedIn.

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