Out-of-pocket costs rise as overall healthcare spending declines

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While healthcare spending growth is at an all-time low, Americans are paying more and more out of their own pockets, according to a new report from the Health Care Cost Institute (HCCI).

Out-of-pocket spending per person was $768 in 2012, an increase of 4.8 percent, according to the report. Nearly half of all out-of-pocket dollars went to professional procedures, such as doctor visits or lab tests, according to the HCCI report. Furthermore, the report indicates that adults ages 55 to 64 outspent those under 18 nearly three to one, and women spent approximately $200 more than men.

Other highlights from the report include:

  • Spending grew fastest for women, people in the Northeast and young adults;

  • Increased prices drove spending growth for outpatient and inpatient facility claims more than increased use;

  • Inpatient services grew at the slowest rate of any medical service (2.4 percent), while outpatient spending grew the fastest (6.5 percent);

  • Per person spending on prescription drugs and devices grew 3.8 percent after three consecutive years of decline.

  • For the first time since the end of the recession, increased spending on generic prescriptions and professional procedures had more to do with increased use than increased prices;

Although average healthcare expenditures grew at nearly the same rate in 2012 as 2011, the causes of the 4 percent increase in spending each year were quite different, HCCI Executive Director David Newman said in a statement.

"In prior years, rising health care prices drove up spending," he said. "In 2012, we saw utilization start to change health care trends for prescription drugs and professional procedures. Preliminary evidence suggests this may be indicative of a larger shift in care as people search for lower cost care alternatives."

The report also found that generic drug prices increased 5.3 percent while spending on generic prescriptions increased from $33 to $277 per person.

Much of the spending increase is because many people only recently obtained access to healthcare, Carolina-Nicole Herrera, the institute's director of research, told USA Today. Furthermore, she said, increases in preventive healthcare, such as annual physicals, could lower costs over time.

To learn more:
- here's the HCCI report
- read the HCCI statement
- check out the USA Today article

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