Health Care Cost Institute: Spending in employer-sponsored plans hits all-time high 

hospital money
The Health Care Cost Institute has released its annual look at spending and service use among people with employer-sponsored plans. (Getty/PraewBlackWhile)

Spending for people enrolled in employer-sponsored plans hit an all-time high in 2017, according to a new report. 

The Health Care Cost Institute released its annual report (PDF) diving into costs and utilization of services among people with employer-sponsored plans and found that per-member expenses reached an average of $5,641 in 2017. 

That’s an increase of 4.2% from 2016, and prices for services are driving that trend, according to the report, which is based on data from between 2013 and 2017. 

“Healthcare spending growth exceeded 4% for the second consecutive year, outpacing per capita GDP growth,” Niall Brennan, CEO of the institute, said in a statement. “And for the most part, Americans aren’t using more healthcare services, which means we’re essentially paying more and more for the same amount of care.”

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For example, spending on inpatient care increased by 10% between 2013 and 2017, though use decreased by 5% in that same window, the study found. That trend was driven mostly by rising prices in medical and surgical admissions. 

Similarly, spending on outpatient surgeries during that time increased by 14%, even as the number of surgeries declined by 4%. 

The report also dives into spending differences among different patient populations. More than 40% of members between the ages of 19 and 25 had no claims for healthcare or medications in 2017, compared to just 15.8% of those aged 55 to 64. 

Members with at least one of five chronic conditions—diabetes, asthma, hypertension, attention deficit/hyperactivity disorder and congestive heart failure—accounted for significantly more spending than those without a chronic illness. Patients with one of those conditions spent an average of $8,921 in 2017, while those with two or more spent $20,257. 

Meanwhile, members without one of these illnesses spent an average of $3,603 that year. 

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Consumers’ out-of-pocket costs increased by 2.6% in 2017, according to the study. As these costs rose at a rate slower than overall spending growth, it means that by 2017 out-of-pocket costs accounted for a smaller share of overall spending. 

The researchers said that having the full picture of spending data can help craft more effective policies to keep those costs low. 

“Diverging trends across several subcategories of services provide important context for where and to whom these healthcare services are being delivered,” John Hargraves, a senior researcher at the institute and the report’s co-author, said.