Healthcare Business News

Spending by privately insured patients continues to be sluggish

By Melanie Evans
Posted: January 9, 2014 - 4:15 pm ET

Spending on hospitals, pharmaceuticals and outpatient care by privately insured patients grew more slowly during the year that ended last August than in the previous 12 months, according to data from S&P Dow Jones Indices.

Healthcare spending for 60 million commercially insured Americans increased 3.2%, down from a 4.8% climb in the preceding year, according to an analysis of claims data.

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The data offer a more recent snapshot of health spending after the release this week of federal health spending estimates for 2012. The numbers suggest continued pressure on health spending growth among the privately insured, which has contributed to sluggish overall health spending growth in recent years.

Spending on hospital care slowed marginally to 4.2% from 4.4%, according to the S&P Dow Jones Indices report. Demand dropped but prices increased 6%, said David Blitzer, a managing director and index committee chairman for the firm. Use, which declined 2%, was measured by total number of hospital days, he said.

The decline in the growth of outpatient spending was more significant. Outpatient spending increased 5.7%, the look at private claims found, compared with 7.9% for the period that ended August 2012. Blitzer said the growth in the outpatient sector could not be broken down by price and use.

Overall spending on prescriptions increased only 0.9% during the 12 months assessed in the S&P Dow Jones Indices report, compared with 2.9% the prior year.

Brand-name drug use dropped 15.6% after declining 11.9% a year earlier. Meanwhile, generic use increased 8.9% during the 12-month period and 6.3% the year before. The price of branded drugs per unit grew more quickly, however, increasing 15.9% in the August 2013 year compared with 14.8% the prior year, which may reflect a push among drug companies to boost revenue, Blitzer said.

The S&P Healthcare Claim Indices are based on claims data from 33 health insurers and other healthcare data providers.

This story has been updated to correct the name of S&P Dow Jones Indices.

Follow Melanie Evans on Twitter: @MHmevans

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