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U.S. spending at the top
Data: Healthcare prices well above other countries

By Melanie Evans
Posted: March 30, 2013 - 12:01 am ET

Healthcare spending in the U.S. dwarfs what other industrialized nations pay as a percentage of their economies. That appears to be true, too, for the prices paid for many services, drugs and devices. The International Federation of Health Plans is collecting data that its members (more than 100 in 25 countries) say might shed some light on what drives the differences. Last year, its U.S. members paid significantly more than private and public insurers in 10 other countries for common procedures, hospital and doctor visits and prescriptions.

“It means, to us, that apparently the difference in the cost of healthcare is not so much about utilization,” said Tom Sackville, CEO of the IFHP. “They seem to be more about the actual unit cost of items of care.” The report also offered a snapshot of the wide variation of prices in the U.S. by including prices at the 25th and 95th percentiles for specific goods and services.

A day in a U.S. hospital totaled $1,514 at the 25th percentile and $12,537 at the 95th percentile. Without more awareness of the nation's widely fluctuating prices, efforts to address U.S. healthcare prices would be “confusing and annoying,” said Kaiser Permanente President and CEO George Halvorson, the federation's chairman.The dynamic could change as consumers shop in the healthcare reform law's insurance exchanges, Rand Corp. economist David Auerbach said. Plans contracting with lower-cost providers, he said, may be more competitive.

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