Healthcare spending up 4.6%, while service use plateaus: 5 things to know

While healthcare spending depends on price and service use, substantial hikes in healthcare spending between 2012 and 2016 were mainly due to price increases, according to a recent Health Care Cost Institute report.

The 2016 Health Care Cost and Utilization Report examines HCCI's commercial claims database. HCCI used the database, which comprises information on Americans under age 65 covered through employer-sponsored health plans, to analyze overall health system costs from 2012 to 2016.

Here are five key findings from the report.

Healthcare spending

1. Americans under the age of 65 with employer-sponsored health plans spent more on healthcare than ever, with spending growing faster in 2016 than in recent years. Per person, total healthcare spending grew 4.6 percent in 2016. That's compared to 4.1 percent in 2015, and follows two years of lower than 3 percent growth from 2012 to 2014.

2. In 2016, per-person healthcare spending for commercially insured individuals grew to $5,407.

3. The main culprit of spending growth from 2012 to 2016 was price increases. Prices grew each year and across almost all service categories in that period, with the greatest price increases seen in prescription drugs (up 24.9 percent) and inpatient services (up 24.3 percent).

Healthcare use

4. While total healthcare spending grew in 2016, use of most healthcare services held still or fell. This happened year over year and during the 2012 to 2016 period. 

5. The only service that didn't fall during the 2012 to 2016 period was prescription drug use, which grew by 1.8 percent. Inpatient services saw the largest decrease in the same period, falling by 12.9 percent.

More articles on healthcare finance:
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Texas Children's Hospital sees operating income drop 66% in FY 2017
CHS aims to shed at least 20 more hospitals to reduce debt load

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