'It's still the prices, stupid': Researchers update study on what's escalating US healthcare costs

Morgan Haefner - Print  | 

The primary reason the U.S. spends more on healthcare than any other country is still prices, according to an updated study published in Health Affairs.

Four things to know:

1. In 2003, four researchers — Gerard F. Anderson, PhD, a professor at Johns Hopkins Bloomberg School of Public Health in Baltimore; Peter Hussey, PhD, vice president and director of healthcare at the Boston-based RAND Corp.; Varduhi Petrosyan, PhD, professor and dean in the Turpanjian School of Public Health at the American University of Armenia; and recently deceased Uwe Reinhardt, PhD, health economist at Princeton (N.J) University — authored an article titled "It's the Prices, Stupid." The article argued that the U.S. spends more on healthcare than other countries because of healthcare prices.

2. In an updated article titled "It's Still the Prices, Stupid," three of the researchers used Organization for Economic Cooperation and Development Health Statistics to update the analysis and review critiques of the original publication. For the most recent article, the authors replicated tables used in the original article, which segmented spending, availability of resources and use in 1990 and 2000. They compared the findings with the most recent OECD data available as of January 2018.

3. The researchers found the U.S. is still providing significantly fewer healthcare resources per capita, such as hospital beds, physicians and nurses, than a median country in OECD's data set. This is occurring despite health policy reforms and restructuring, they wrote.

4. "Because the U.S. is still not devoting more real resources to medical care than the typical OECD country, we believe that the conclusion that 'it's the prices, stupid,' remains valid," the study authors concluded. "What is different between 2003 and 2016 is that the differential between what public and private insurers pay for healthcare services has become wider. Lowering prices in the U.S. will need to start with private insurers and self-insured corporations."

Access the full Health Affairs article here.

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