Altarum: Growth in spending on privately insured patients outpacing Medicaid, Medicare

Medicine Money
Growth in private spending was driven almost entirely by higher prices, as well as increased utilization and intensity, according to the report. (Getty/utah778)

Growth in spending on privately insured patients drove much of the increase in healthcare spending in the U.S. in 2017 and the first part of 2018. 

That's according to a report released Thursday by Altarum Institute, which said spending on the privately insured accelerated compared to those covered by Medicaid and Medicare in the last year and a half despite low growth in enrollment in private insurance.

To be clear, spending on Medicare and adult Medicaid enrollees is still higher than spending per enrollee in private health plans. But it's a shift from just a few years ago, when private spending growth was either near or below Medicare and Medicaid rates, the authors said.

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And while Medicaid and Medicare spending growth is largely attributable to higher enrollment since 2014, the private spending growth during that same time was driven almost entirely by higher prices, as well as increased utilization and intensity, the report said. 

RELATED: Altarum: Healthcare spending growth has begun to stabilize

Private payer spending per enrollee has grown at three times the rate of Medicare and Medicaid spending per enrollee at 45.9% growth compared to 14.7% and 14.9%, respectively. 

The trend isn't likely to be long term but more of a notable pause. The authors pointed out that a future economic downturn could drive spending back toward Medicaid, and the growth in the senior population will increase the number of Medicare enrollees.

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