Price Increases, Not Utilization, Drove Up Healthcare Spending in 2013

Rising prices, not increased utilization, drove increased spending on acute inpatient care, outpatient care and brand prescriptions, according to the Health Care Cost Institute’s 2013 Health Care Cost and Utilization Report. Healthcare spending increased an average 3.9 percent in 2013.


Since 2010, health spending per insured person has grown by an average of 3.9 percent per year, considerably slower than historical expenditure growth for this population.


Some specific details noted in the report include:


  • Healthcare spending averaged $4,864 per individual covered by employer-sponsored insurance ($183 more than in 2012)
  • Acute inpatient care spending increased 3.9 percent
  • Spending for professional procedures increased 3.3 percent
  • Out-of-pocked spending increased 4 percent
  • Outpatient services spending increased by 5.2 percent
  • Prescription drug spending increased by 3.1 percent


Utilization decreased across a broad range of services. Specifically:


  • Use of brand prescription drugs, inpatient admissions and outpatient services declined in 2013. However, average prices increased for all three categories, and at higher rates than in 2012.
  • Acute inpatient admissions per 1,000 declined 2.3 percent due to a 5.1 percent drop in medical and 3.7 percent drop in surgical admissions per 1,000 insured patients.
  • A 0.8 percent reduction in outpatient visits was driven by declines in outpatient surgery and emergency department visits.


Healthcare spending was similar in 2013 to the previous two years, the report authors noted. “In each of those years, rising medical and brand prescription prices led to spending growth,” the report stated. “However, unlike in 2011 and 2012, declining utilization in 2013 offset price increases, keeping expenditure growth historically slow.” (2013 Health Care Cost and Utilization Report, Health Care Cost Institute, October 2014)


For a copy of the report, please click here.



Additional source: “Report: Prices Drive 3.9 Percent Increase in Healthcare Spending,” HFMA Weekly News, October 31. 2014



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