2015 Health Care Cost and Utilization Report November 2016 www.healthcostinstitute.org Copyright 2016 Health Care Cost Institute, Inc. Unless explicitly noted, the content of this report is licensed under a Creative Commons Attribution Non-Commercial No Derivatives 4.0 License 2015 Health Care Cost and Utilization Report i Executive Summary BY THE NUMBERS: 2015 The Heath Care Cost Institute (HCCI) prescriptions), and for the subservice is pleased to release the 2015 Health and detailed service categories that Care Cost and Utilization Report. The make up the major service categories Mainly price growth but also report covers the health care cost and (see “Key definitions” for more infor- growth in utilization pushed utilization trends for Americans mation about HCCI’s health care ser- up spending younger than age 65 and covered by vice categories, page iii). employer-sponsored insurance (ESI) for the years 2012 through 2015. It Components of the National $5,141 includes data from four national in- Spending Trends Spending per capita for the ESI popu- surance companies: Aetna, Humana, In 2015, spending per capita for the lation Kaiser Permanente, and UnitedH- ESI population grew by 4.6% over the ealthcare. Due to the inclusion of Kai- previous year, to $5,141 per person ser Permanente data in the HCCI da- taset, data and trends in the 2015 Re- (Table 1). This growth was faster than previous years’ growth: 3.0% growth 4.6% port cannot be directly compared to in 2013 and 2.6% growth in 2014. Increase in health care spending per those in HCCI’s previous Health Care The 4.6% spending growth rate was capita, higher than the previous two Cost and Utilization Reports (which slightly higher than might be ex- years can be found on HCCI’s Website). pected, given the previous years’ However, the methodology used to growth rates. In every year studied, analyze the new dataset was the same the biggest driver of per capita spend- as in previous years (see Data and ing growth was increasing prices. $813 Methods, page 28).1 However, in some years increases in Out-of-pocket health care spending the utilization of services also played per capita As in previous years, the focus of this a role in spending growth (see Driv- report is on trends in health care per ers of Spending Growth, page 10). capita spending, per capita out-of- pocket spending, utilization of health Specifically, in 2013, utilization of 15.8% care services, and average price of generic prescriptions and profession- services for the younger than 65, na- al services increased. These increases Proportion of total health care spend- tional ESI population. The report also in use, combined with price increases ing paid out of pocket, the lowest dur- measures growth in intensity—that for all service categories except for ing the study period is, the complexity—of health care ser- generic prescriptions, led to a 3.0% vices and adjusts for intensity to pro- rise in per capita spending in that duce an intensity-adjusted average price (see “Decomposition key defini- year (Appendix Table A1). In 2014, utilization of the medical service cate- 1.5% & 0.2% tions”, page 12). For national per capi- gories and brand prescriptions de- Increases in utilization of outpatient- ta spending and out-of-pocket spend- clined, while only use of generic pre- other and professional services ing, trends are also broken down by scriptions increased (Appendix Table region of the country, age group, gen- A2). At the same time, the average der, and age-gender groups. Health care utilization, price, intensity, and price of every service category in- creased, although generally at slower 2.7% & 3.5% intensity-adjusted price trends are rates than in the previous year. The Increases in the average price per out- presented for each of the four major general declines in the utilization of patient-other and professional service health care service categories (the services, combined with the slightly three medical service categories and slower growth in price, led to the www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report ii smaller growth in spending in 2014. spending paid by consumers were Services). largely influenced by declining out-of- In 2015, we observed the fastest per Overall decline in the use of ER visits: pocket spending on brand and generic capita spending growth rate of the In 2012, the utilization of emergency prescriptions. While out-of-pocket study period: 4.6% (Appendix Table room (ER) visits for the national pop- per capita spending on outpatient A3). The trends in utilization and ulation was 180 ER visits per 1,000 services and professional services price growth in 2015 were more simi- insured (Appendix Table A23). By increased in each year studied – and lar to the trends observed in 2013 2015, this number had dropped to out-of-pocket spending on acute inpa- than those observed in 2014. Utiliza- 173 visits per 1,000 individuals. HCCI tient admissions increased in most tion of professional services and ge- had previously noted this trend in years, the out-of-pocket per capita neric prescriptions increased (as in fewer ER visits by children (ages 0- spending on brand and generic pre- 2013), as did the utilization of outpa- 18). In this report, we observed a de- scriptions declined each year. This tient-other services. In general, the cline in 2015 in the use of ER visits by may have had the largest impact on average price growth for the catego- nearly all age groups. The exception the out-of-pocket spending trends of ries of health services grew faster in was for the oldest adult age group the oldest age group of adults studied 2015 than in the previous study peri- (ages 55-64), whose use was stable (ages 55-64). The oldest adult age od’s years. Utilization increases in between 2014 and 2015 (see Outpa- group was the only age group to expe- several health services categories and tient Services). rience a decline in out-of-pocket per faster growth in prices combined to capita spending in a single year (in Utilization of MHSU, LD, and newborn create the study period’s fastest per 2014), and this was observed for both hospital admissions stable: Over the capita spending growth rate. men and women in that age group study period, the national utilization Changes in Out-of-Pocket Spend- (Appendix Table A4). Compared to rates of mental health and substance ing Trends the out-of-pocket spending growth use (MHSU), labor and delivery (LD), rates observed for men and women in and newborn admissions each stayed Out-of-pocket spending per capita for the younger age groups, the slowest steady; the number of admissions per the study population increased each average annual growth in out-of- 1,000 insured in the last year of the year of the study period (Table 2). pocket per capita spending was ob- study period was the same as in the (For more information about the com- served for men and women in the first year (Appendix Table A23). In ponents of out-of-pocket spending, oldest adult age group. contrast, use of the much more com- see “Out-of-pocket spending defini- mon medical and surgical admissions tions”.) The fastest growth in out-of- Notable trends declined over the study period; and pocket per capita spending occurred Office visits to PCPs declined: Between there were fewer of each of these in 2013 (3.3%). The following year, 2012 and 2015, the number of office more common admissions in the last out-of-pocket spending per capita visits to primary care physicians year of the study period than in the grew at a much slower rate, just 1.8%. (PCPs) declined at an average annual first year (see Acute Inpatient Admis- In 2015, the final year of the study rate of 4.7% (Appendix Table A23). sions). period, per capita out-of-pocket There were 209 fewer office visits to spending grew by 3.0%. In each year Spending per capita on brand anti- PCPs per 1,000 insured in 2015 than studied, per capita out-of-pocket infective agents increased, while use in 2012. In contrast, the utilization spending grew at slower rates than decreased: Between 2012 and 2015, rates for the other types of doctor did total per capita spending. Be- spending per capita on brand anti- visits identified by HCCI (office visits tween 2012 and 2014, the proportion infective agents nearly doubled, going to specialists, preventive visits to of total spending that consumers paid from $53 per person to $101 per per- PCPs, and preventive visits to special- out of pocket was relatively stable, son (Appendix Table A20). This $48 ists) generally increased over the moving only from 16.1% to 16.2%. per person increase in spending made study period. The largest increase in However, in 2015, that percentage up 40.3% of the $119 increase in per use was for office visits to specialists, declined slightly, to 15.8%. person spending on all brand pre- which increased over the study peri- scriptions. Over the same period, utili- The per capita out-of-pocket spending od by 167 office visits to specialists zation of brand anti-infective agents trends and the decline in the share of per 1,000 insured (see Professional dropped an average annual 7.3% www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report iii KEY DEFINITIONS What is per capita spending? Per capita spending in this report is the estimate of total expenditures on medical and pharmacy claims divided by the employer-sponsored insured (ESI) population. What are medical services and their subservice and detailed categories? Three medical service categories are identified: inpatient facility, outpatient facility, and professional procedures. These service categories are divided into subservice categories and further classified into “detailed service” catego- ries. Acute inpatient admissions: This subservice category consists of the five detailed service categories: medical, surgical, labor and delivery (LD), newborn, and mental health and substance use (MHSU) admissions. It excludes hospice, skilled nursing facility, and ungroupable admissions (see Data and Methods). Only acute inpatient admis- sions are discussed in this report because hospice, SNF, and ungroupable admissions are relatively rare in the younger than age 65 ESI population. However, the trends for the fill inpatient service category are available in the tables. Outpatient visits: This subservice category consists of three detailed service categories: ER visits, outpatient sur- gery, and observation visits. Outpatient-other services: This subservice category consists of four detailed categories that make up the outpa- tient-other services category: ancillary services, miscellaneous services, laboratory and pathology services (lab/ path), and radiology services. Professional services: This subservice category consists of 11 detailed service categories: administered drugs (including chemotherapy drugs); the administration of drugs; anesthesia; office visits to primary care providers (PCPs); office visits to specialists; miscellaneous services; pathology and laboratory (path/lab) services; preven- tive visits to PCPs; preventive visits to specialists; radiology services; and surgery services. What are prescription service, subservice, and detailed service categories and subclasses? HCCI analyzes prescription drug and device claims from pharmacies and suppliers. The prescription service category is divided into brand and generic drug subservice categories and is further classified into detailed service categories, and further into subclasses. Brand and generic prescriptions: These detailed service categories for brand and generic prescriptions are based on the AHFS classification system.2 The prescription detailed service categories are: anti-infective agents; cardiovascular drugs; central nervous system (CNS) agents; eye, ear, nose, throat (EENT) preparations; gastroin- testinal (“gastro”) drugs; hormones and synthetic substitutes (“hormones”); respiratory drugs; skin and mucous membrane (“skin”) agents; and a category of the remaining “other” therapeutic categories of prescriptions. (Appendix Table A23). The per capita Special Section: Spending Per do not represent a random sample of spending increase on brand anti- Capita on Health Care in Selected states, they provide an interesting infective agents was due to the in- States in 2015 look at health care spending trends crease in the average price per filled around the nation. day, which more than doubled from This report introduces a new analysis $35 per filled day to $83 per filled day that describes total and out-of-pocket (Appendix Table A24; see Prescrip- per capita spending trends in 18 tions). states and compares the state-level trends to the national average. The states selected are geographically diverse and meet HCCI’s reporting requirements. Although these states www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 1 Spending Per Capita for the ESI Population In 2015, spending per capita for the an increase of $474 per man and $506 age group (ages 0-18). In 2015, national ESI population was $5,141 per woman. This led to the difference spending was $9,707 per oldest adult (Figure 1 and Table 1). This was a in spending between men and women and $2,791 per child (Table 1). Spend- $226 increase over the previous year. widening over the study period. From ing per capita for children was similar Spending per capita grew each year 2012 to 2015, the difference in spend- to spending for the youngest adults between 2102 and 2015 (the “study ing between genders rose from (ages 19-25): $2,791 and $2,915, re- period”), with spending growth rates $1,071 per capita to $1,103 per capi- spectively. ranging from 2.6% (2014) to 4.6% ta. In all the years studied, the two (2015). Between 2012 and 2015, Per capita spending for women was youngest age groups experienced the spending increased by $488 per per- higher than for men on every type of fastest spending growth rates (Table son. service, except brand prescriptions. In 1). And in 2015, spending grew faster Spending by Gender 2015, spending per capita on brand than in any of the previous study prescriptions was $29 higher for men years, which was true for all the age In each year studied, spending per than for women (Appendix Table A5). groups. However, even with the fast- capita for women was higher than for The largest spending difference be- est spending growth rates, the young- men. In 2015, spending was $5,684 tween the genders was on profession- est age groups had the smallest per per woman and $4,581 per man al services, where spending was $628 capita spending increase over the (Table 1). In each year studied, spend- higher for women. study period. Between 2012 and ing for men grew at a faster rate than 2015, per capita spending growth for spending for women. However, even Spending by Age Group the oldest age group ($901 per per- with faster annual growth rates, In every year studied, per capita son) was nearly three times larger spending for men increased by a spending increased with age and was than the growth for the three young- smaller dollar amount over the study highest for the oldest age group (ages est age groups (over $300 per person; period than did spending for women: 55-64) and lowest for the youngest Figure 2). This per capita spending increase was driven largely by an in- crease in spending on prescriptions. Between 2012 and 2015, for the old- est adult age group, spending on pre- scriptions increased by $358 per per- son; this was larger than the increase in spending on all health services for each of the three youngest age groups (Appendix Table A6). For all of the age groups studied, the highest per capita spending was on professional services followed by spending on outpatient services (Appendix Table AX). For the three youngest age groups, the least per capita spending was on prescriptions, while for the two oldest adult age groups, the least per capita spending was on acute inpatient admissions. www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 2 ence by gender was for surgical ser- vices followed by laboratory and pa- thology (lab/path) services (Appendix Table A11 and Appendix Table A13). Interestingly, for the 45- 54 year old group, the largest spend- ing difference by gender was on ad- ministered drugs: a difference of $156 per person (Appendix Table A15). For adults ages 19-24, the largest per cap- ita spending difference between men and women was on ER visits (a $151 per person difference; Appendix Ta- ble A11). For adults ages 25-44, the largest gender spending difference was on professional surgical services (a $282 difference; Appendix Table A13), while for adults age 45-54 it was on outpatient surgical services (a $247 difference; Appendix Table Spending by Age-Gender Groups that amount, $417 was on surgical A15). admissions (Appendix Table A17). Across the study population, per capi- Per capita spending trends for boys This was the largest spending differ- ta spending for women was higher and girls were similar during child- ence by gender for any age group on a than spending for men. However, for hood (Appendix Table A7). As men detailed category of services. Interest- two of the three age groups--children and women age through the early ingly, the second largest spending (ages 0-18) and the oldest adults adult years (for women these may be difference by gender within this age (ages 55-64), per capita spending was child-bearing years) the spending group was on brand anti-infective higher for boys and men by $265 per trends diverge, and spending is higher agents: $232 higher for the oldest boy and $235 higher per man for women than men on all types of adult men in 2015. (Appendix Table A7). For children, health services. The gender difference per capita spending for boys was For the three middle age groups of in spending peaked in adults ages 25- higher on all subservice categories, adults (ages 19-24, 25-44, and 45-54), 44. Through the two oldest age except for outpatient-other services, spending per woman was higher than groups, spending trends gradually for which spending was $1 higher per spending per man (Appendix Table converged, until spending was higher girl than per boy. On the detailed cate- A7). While per capita spending in- for men than women in the oldest age gories of services, per capita spending creased with age, the difference in group. For more information, see sim- levels were similar for boys and girls; spending between men and women ilar trends reported by Dale Yamamo- the largest spending difference was increased through age 44, and then to in Health Care Costs from Birth to $37, on generic central nervous sys- was smaller for adults ages 45-55. For Death.3 tem (CNS) agents (Appendix Table each of these three age groups, the A9). biggest difference in spending be- Spending by Region tween men and women was on pro- In every year studied, per capita For the oldest adult age group, (ages fessional services. In 2015, per capita spending was highest in the Northeast 55-64), spending for women was spending on professional services and lowest in the West. Per capita higher than for men on professional was at least $500 higher for women spending in the South was second services and all outpatient services. than men. highest, and was third highest in the The largest difference within this age group was for acute inpatient admis- In the professional services category, Midwest. Of the highest and lowest sions: spending per capita was $569 for the two younger adult age groups, spending regions, the dollar increase more for men (Appendix Table A7). Of the largest per capita spending differ- in per capita spending over the study www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 3 period was twice as high in the North- east as it was in the West (Table 1). As noted above, per capita spending on health care tended to increase with age and one possible contributing factor in these spending trends is the average age of the population in these regions. As noted above, per capita spending on health care tended to increase with age. In 2015, of the four regions, the Northeast had the highest median age at 39.7, while the West had the lowest median age at 36.5.4 In 2015, the Northeast had the fastest growth rate (5.1%) observed for any region in any year studied. The larg- est per capita spending increase ($265 per person) was due largely to an increase in spending on prescrip- tions (a $101 per person increase). In increases in per capita spending were person). Of the per capita outpatient comparison, per capita spending in for prescriptions. visit spending, nearly all was on surgi- 2015 on prescriptions rose no more cal visits ($527; Appendix Table A20). than $76 per person in any other re- Professional Services: Of the four ser- gion. vice categories, professional services The remainder of the per capita out- accounted for most of the per capita patient spending was on outpatient- In 2015, the West experienced the spending (Figure 3). In 2015, spend- other services. In 2015, $537 per per- lowest per capita spending and the ing per capita on professional services son was spent on outpatient-other smallest spending increase (Table 1). was $1,738, which made up a third of services (Figure 3 and Table 1). Over Interestingly, the West had the high- the year’s total per capita spending the study period, spending per capita est per capita spending on acute inpa- (Table 1). However, over the study on outpatient-other services experi- tient admissions of any region period, these services saw modest enced slower growth rates and small- ($1,058), but had nearly the lowest spending growth: $125 per person. In er dollar increases compared to out- per capita spending on all other cate- 2015, as in all years studied, most patient visits. Between 2012 and gories of health services (Appendix professional service spending was on 2015, spending per capita on outpa- Table A19). For example, spending on surgical services: $278 per person tient-other services increased by $48 prescriptions in the West was $784 (Appendix Table A20). Over the study per capita, compared with a $125 in- per person, compared with $1,057 period, per capita spending on admin- crease on outpatient visits. per person in the South. istered drugs had the largest spend- Acute Inpatient Admissions: In 2015, Spending by Service Category ing increase. Between 2012 and 2015, spending on acute inpatient admis- spending on administered drugs rose As with total spending per capita, sions was $997 per person (Figure 3 from $158 per person to $190 per spending on each of the categories of and Table 1). Over the study period, person. health services increased each year of acute admissions generally had the the study period (Table 1). The slow- Outpatient Services: The second high- slowest per capita spending growth est growth rates in spending per capi- est spending per capita, after profes- rates and had the smallest spending ta and the smallest dollar increase in sional services, was for outpatient increase. Between 2012 and 2015, spending across the study period was services. In 2015, per capita spending spending on acute admissions in- for acute inpatient admissions. The on outpatient services was $1,427 creased by $53 per person, compared fastest growth rates and largest dollar (Figure 3 and Table 1), most of which to a $153 per person increase in was on outpatient visits ($890 per spending on all outpatient services www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 4 over the same time period. In the spending was on central nervous sys- acute inpatient admissions category, tem (CNS) agents ($97 per capita), the most per capita spending in 2015 which saw just a $2 per person in- was on surgical admissions ($513), crease in 2015 (Appendix Table A20). followed by medical admissions ($296; Appendix Table A20). In 2015, of the detailed categories of acute admissions, only surgical admissions had a spending increase that was greater than $3 per person, having risen by $15 per person. Prescriptions: Compared to the other service categories, the least dollars per capita were spent on prescrip- tions: $964 per person in 2015 (Figure 3 and Table 1). However, pre- scriptions had the fastest spending growth rate of any service category in both 2014 and 2015. Prescriptions also had the largest dollar increase in per capita spending both in 2015 ($77 per person) and over the entire study period ($159 per person). Per capita spending was twice as high on brand prescriptions as on generic prescriptions: in 2015, $649 versus $313 (Figure 3 and Table 1). In 2014 and 2015, brand prescriptions had a faster growth rate than any other ser- vice category. In 2015, brand pre- scriptions also had the largest dollar increase in per capita spending ($66), largely due to increases in per capita spending on brand hormones and synthetic substitutes (a $22 per per- son increase) and brand anti-infective agents (a $20 increase; Appendix Ta- ble A20). In contrast, of all the service catego- ries, per capita spending was lowest on generic prescriptions ($313) (Figure 3 and Table 1). Spending on generic prescriptions increased by just $10 per capita in 2015 and by $39 over the study period, the small- est dollar spending increase for all service categories. In the generic pre- scriptions category, the highest www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 5 www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 6 Out-of-Pocket Spending Per Capita Out-of-pocket spending per person women paid a larger percentage of pocket declined with age. The young- increased each year studied, reaching their total health care costs out of est adult age group (19-25 year olds) $813 per capita in 2015 (Figure 4 and pocket: 16.3% for women compared paid the highest percentage of costs Table 2; see “Out-of-pocket spending to 15.1% for men. (18.6%) out of pocket, compared with definitions”, page 8). Between 2014 13.1% for the oldest adults. During the study period, men general- and 2015, spending per capita out of ly saw out-of-pocket per capita The younger age groups also had fast- pocket grew by $24, and between spending grow at faster rates than did er growth rates for their out-of- 2012 and 2015, by $62 per person. In women. However, between 2012 and pocket spending compared to the old- the first three years of the study peri- 2015, out-of-pocket per capita spend- er age groups. In each year studied, od, between 2012 and 2014, the per- ing for women increased by a larger the two youngest age groups (ages 0- centage of total health care costs amount than for men: $68 per woman 18 and 19-24) had the fastest spend- borne by consumers out of pocket compared with $56 per man (Table ing growth rates. Interestingly, the was stable at just over 16%. In 2015, 2). oldest adult age group (age 55-64) this proportion declined slightly, to saw their per capita out-of-pocket 15.8% of total health care costs paid Out-of-Pocket Spending by Age spending decline slightly in 2014, by out of pocket. Group $12 per person (Table 2). Both in Out-of-Pocket Spending by Gen- As with total spending, out-of-pocket 2015 and over the entire study peri- der spending per capita increased with od, the smallest dollar increase in per age. The oldest age group had the person out-of-pocket spending was In every year studied, women paid highest per capita out-of-pocket observed for the oldest adults more per capita out of pocket than did spending ($1,269 in 2015), while the (declines of $16 per person and $42 men. In 2015, women paid over 30% youngest age group had the lowest per person, respectively). The largest more out of pocket: $929 per woman ($482; Table 2). However, the share dollar increase in per person out-of- and $693 per man (Table 2). Also, of total health care costs paid out-of- pocket spending in both 2015 and across the study period was for the 26 -44 year old age group: declines of $28 per person and $72 per person, respectively. Over the study period, all the age groups saw the biggest increases in per capita out-of-pocket spending on professional services and outpatient services (Appendix Table A21). In contrast, per capita spending out of pocket on prescriptions, especially brand prescriptions, declined for eve- ry age group over the same period. The largest declines in prescription out-of-pocket spending were for the oldest age groups, while the smallest spending declines were observed for the youngest age groups. www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 7 pocket spending (Table 2). In con- trast, out-of-pocket spending on acute admissions was stable over the study period, while out-of-pocket spending on prescriptions declined each year. Professional Services: In 2015, as in all years studied, more per capita out-of- pocket dollars were spent on profes- sional services than any category of health services: $372 per person in 2015 (Table 2). This higher spending on professional services was due largely to higher total spending and higher average utilization of these services compared to total spending and utilization for the other medical service categories. Over the study period, the out-of-pocket spending on professional services increased by $44 per person, the largest increase of Out-of-Pocket Spending by Re- compared with a $103 per person the health service categories. Out-of- gion increase in the Northeast – the largest pocket per capita spending on office increase for any region. visits to specialists made up over 30% In 2015, out-of-pocket spending was the lowest in the West ($637 per per- Out-of-Pocket Spending by Ser- of the spending increase and account- son), and the second-lowest total per vice Category ed for the highest out-of-pocket capita spending. However, unlike to- spending on any single type of profes- Overall, professional services and sional service ($64 per capita in 2015; tal spending trends, the highest out-of outpatient services had the highest Appendix Table A22). -pocket spending was observed in the out-of-pocket spending per capita and South ($903; Table 2), whereas it has the largest dollar increases in out-of- the second highest total per capita spending (Table 1). The South also paid the highest percentage of health care costs out of pocket: 17.2% com- pared to 13.5% in the West and 14.7% in the Northeast (Table 2). The Northeast generally had the fast- est out-of-pocket spending growth, while the West had the slowest. In 2014, the West saw a $1 per person decrease in out-of-pocket spending per capita (Figure 5 and Table 2). The West was the only region to experi- ence a decline in per capita out-of- pocket spending during the study pe- riod. Due to the slower growth rates over the 2012-2015 study period, the West saw just an $11 per person in- crease in out-of-pocket spending, www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 8 Outpatient Services: Outpatient ser- est out-of-pocket spending was on vices accounted for the second high- medical admissions: $15 per capita in est share of out-of-pocket spending 2015 (Appendix Table A2). and second largest per capita increase Prescriptions: In contrast to out-of- in out-of-pocket spending. In 2015, pocket per capita spending on medi- out-of-pocket spending on outpatient cal services, out-of-pocket spending services was $235 per person, up $42 on prescriptions declined throughout per person from spending in 2012 the study period (Figure 6 and Table (Table 2). Of that $235, 60% was 2). Between 2012 and 2015, spending spent on outpatient visits, while the out of pocket on prescriptions de- remaining 40% was spent on outpa- clined from $184 per person to $157 tient-other services. The highest per person. Generic prescriptions spending on outpatient visits was for accounted for more out-of-pocket per emergency room (ER) visits: $72 per capita spending than brand prescrip- person (Appendix Table A22). ER vis- tions: in 2015, $96 per person versus its also had the largest increase in per $61 per person. However, between capita out-of-pocket spending over 2012 and 2015, out-of-pocket spend- the study period, comprising half of ing on brand prescriptions saw a larg- the total $41 per person increase in er decline ($22 per person) than did out-of-pocket spending on all outpa- generic prescriptions ($5 per person). tient services. The drop in brand prescription Acute Inpatient Admissions: After a $4 spending was due largely to spending per person increase between 2012 declines for brand cardiovascular and 2013, spending out of pocket on drugs (an $8 per person decline) and acute admissions was $49 per person brand CNS agents (a $7 per person in the subsequent years studied decline; Appendix Table A22). (Table 2). Of the out-of-pocket dollars spent on acute admissions, the high- OUT-OF-POCKET SPENDING DEFINITIONS Out-of-pocket spending per capita: Out-of-pocket spending includes the patient’s share of payment for the provi- sion of health care services and prescriptions covered by insurance; such spending includes any copayments, coinsur- ance payments, or deductible payments. If an insurance claim was not filed (e.g., for the purchase of over-the-counter medicines), the expenditures are not included in this metric. These payments also do not reflect any refunds, rebates, coupons, or discounts that individuals received after making the out-of-pocket payments. HCCI calculated out-of- pocket expenditures per capita by dividing total out-of-pocket spending by the total insured population. Deductibles: A deductible, both individual and family deductibles, is the amount of incurred health care costs that an insured must pay out of pocket before the health plan reimbursement begins in a contract period. For example, for health care expenses of $2,000 in a year, an insured with a $1,000 deductible would pay the first $1,000 out of pocket. After the deductible is satisfied, the insured and the health plan jointly pay for the remaining $1,000 of expenses ac- cording to the insurance contract’s coinsurance and co-payment policies. Coinsurance: Coinsurance is the portion of covered health care costs borne by an insured. After insureds meet their deductible requirements, they generally pay for a portion of the remaining health care expenses out of pocket. For example, they may pay according to a fixed percentage of the expense, such as 20%. The insurer (payer) pays the oth- er 80%. Co-payments: Copayments are specified amounts paid by the insured for services delivered. Typically, copayments are fixed fees for such services as physician office visits, prescriptions, and hospital admissions. www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 9 www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 10 Drivers of Spending Growth Health care cost growth is the result of changes in the number of services provided (“utilization”) and the prices paid for those services. Included in the calculation of prices paid is service intensity—the complexity of services used to provide care. Thus, to examine drivers of spending growth, HCCI analyzed how the different components of spending — price and utiliza- tion, along with intensity and intensity-adjusted prices — affected health care trends for medical and prescription categories of health services. Specifically, HCCI measured utilization for medical subservice categories as the number of services used per 1,000 individu- als, and, for prescription categories, the number of filled days of a prescription per 1,000 individuals. Price was measured for medical service categories as the average price of a service in that category, whereas for prescription categories, it was meas- ured as the average price of a filled day of a prescription. Because changes in price could reflect changes in how care is deliv- ered, HCCI’s analyses also considered intensity — the complexity of services used to provide care. Intensity was used to ad- just prices paid to a base price that all patients would pay for a given service (“intensity-adjusted price”). Adjusting prices for intensity allowed HCCI to examine whether prices changed owing to differences in the resources used to treat patients or to changes in other factors. (For more information about these metrics and the categories of health care services, see “Key Defi- nitions”, page iii.) Between 2012 and 2015, the average price per service for each medical service category and for brand prescriptions rose each year (Figures 7 and 8 and Table 3). Utilization rate trends, however, were more mixed. While use of acute inpatient ad- missions and brand prescriptions fell every year studied, in 2015 utilization rates increased slightly for outpatient services and professional services and increased every year of the study period for generic prescriptions. In both 2014 and 2015, the decline in the use of filled days of brand prescriptions was larger than the increase in the use of generic prescriptions, which led to a net decline in these years in the use rate for filled days of prescriptions. In 2015, small increases occurred in the aver- age intensity of medical services, which, combined with the increases in average price, led to increases in the average intensi- ty-adjusted price for medical services. In 2015, per capita spending for the ESI population increased by 4.6%; this was a larger spending increase than occurred in the study period’s previous years (Table 1). This spending increase was due mainly to increases in the average price of health services (Figure 8 and Appendix Table A3). However, the increase in 2015 was larger than in prior years due to the small increases in utilization of outpatient and professional services in that year (Appendix Tables A1-A3). www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 11 Drivers of Spending Growth – Continued www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 12 DECOMPOSITION KEY DEFINITIONS What is utilization and average price? Utilization is the average number of uses for a service per 1,000 insured. For every service use, there is an associated dollar amount paid to providers by both insurers and the insured. Average price is calculated by dividing total spend- ing for a service category, subservice category, or detailed service category by the associated number of service uses. What is intensity? Intensity is a measure of the complexity of a service, including length of delivery time, severity of illness, and amount of resources used for each medical service. For example, one patient has a simple 15-minute appointment with a phy- sician, while another patient has a 30-minute visit with the same physician. Intensity of services is greater for the sec- ond patient, even though each was counted as a single office visit. Many factors can account for changes in service in- tensity, including new and better forms of treatment, the health status of the population receiving services, and reim- bursement system modifications that either encourage or discourage one form of treatment over another. HCCI measures intensity by assigning a weight designed by Centers for Medicare & Medicaid Services (CMS) and commer- cially adjusted to each medical service, when possible. HCCI does not currently calculate intensity for prescriptions, admissions to a hospice or skilled nursing facility, or ungroupable hospital admissions. What is intensity-adjusted price? Isolating the effect of intensity on the price paid per service allows for the calculation of the price of a service after adjusting for delivery time, the patient’s severity of illness, and resources used. The consumer never sees this price directly. The intensity-adjusted price, sometimes known as “unit price”, is calculated by dividing the average price paid for the service by the average intensity of the service. For example, intensity equal to one would lead to no differ- ence between prices paid and intensity-adjusted prices. Intensity less than one would lead to a higher adjusted price than the price paid; an intensity level greater than one would mean that the adjusted price was less than the price paid. www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 13 www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 14 Professional Services Spending on professional services made up the largest portion—about one third--of total per capita spending for the ESI population. In 2015, spending on professional services was $1,738 per person (Table 1). Over the study period, spending on these services grew moderately, at an average annual rate of 2.5%. Between 2012 and 2015, total spending grew by $125 per person; a smaller in- crease than for outpatient services or prescriptions over this period. Compared to the other categories of medical services, the utilization rate of professional services was much higher. Use of professional services increased slightly in 2013, declined slightly in 2014, and increased again in 2015 (Figure 9). The 2015 increase a professional service was relatively its as four types: office and preventive in use was small, but pushed total stable over the time period. After ad- visits, to either PCPs or specialists. Of spending such that 2015 growth ex- justing for intensity, the average in- those types of doctor visits, in 2012, ceeded 2014 growth. Notably, alt- tensity-adjusted price of a profession- the most dollars per capita were hough the rate of use of professional al service over the study period in- spent on office visits to PCPs. Howev- services increased in 2015, use of creased at an average annual 2.0%. er, over the study period, spending these services in 2015 was lower than per capita on office visits to special- at the beginning of the study period in Spending on Professional Ser- ists increased each year (by an aver- 2012: 16,305 services per 1,000 in vices age annual 7.3%), while spending on 2015 compared to 16,515 services The detailed categories of profession- office visits to PCPs generally declined per 1,000 in 2012. al services include office visits to pri- (mirroring the trend in the utilization The average price per professional mary care providers (PCPs), office rate of these visits; Figure 10). In service increased every year studied, visits to specialists, preventive visits 2015, spending on office visits to spe- but increased at a much slower rate to PCPs, preventive visits to special- cialists was $162 per person, com- than the rates for the other categories ists, administered drugs, laboratory pared with $138 per person on office of medical services. The average price and pathology (lab/path) services, visits to PCPs. Comparatively, the of a professional service grew at an radiology services, administration of spending per capita on preventive average annual 3.0%, compared to drugs, anesthesia, surgical services, visits was much lower; in 2015, average annual growth of 5.6% for and a category of the remaining spending on preventive visits to PCPs acute admissions and 4.7% for outpa- “miscellaneous” services. Of these was $49 per person, compared with tient services (Table 3). Between detailed categories, the most spend- $20 per person on preventive visits to 2012 and 2015, the average price for ing was on visits to the doctor: $369 specialists. Between 2012 and 2015, a professional service increased from per person in 2015 (Appendix Table per capita spending increased by an $98 to $107. The average intensity of A20). HCCI classifies these doctor vis- average annual 5.7% for preventive www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 15 creases in the use of office visits to specialists, of preventive visits to PCPs, and of preventive visits to spe- cialists did not offset the decline in the use of office visits to PCPs. Be- tween 2012 and 2015, the use of all doctor visits declined, from 3,361 doctor visits per 1,000 insured in 2012 to 3,348 per 1,000 in 2015 (data not shown). Between 2012 and 2014, rates of use generally declined for the profession- al services categories of administra- tion of drugs, anesthesia, surgical ser- vices, and miscellaneous services. However, in 2015, the use of these services increased slightly. Miscella- neous services saw the largest in- crease in use (by 177 services per 1,000 insured) and the highest use visits to PCPs and 6.3% for preventive each year studied, by an average an- rate: 5,577 services per 1,000 insured visits to specialists. nual 1.9%, falling by $8 per person (Appendix Table A23). Comparatively, over the study period to $127 per Consistent with the spending trends the other three types of services had person in 2015. Spending per capita for doctor visits, per capita spending much lower utilization rates, with the on professional lab/path services in- generally increased over the study highest rate for surgical services (666 creased moderately between 2012 period on the administration of drugs, surgical services per 1,000 insured in and 2014, before a small decrease in anesthesia, professional surgical ser- 2015). spending in 2015 (to $144 per per- vices, and the miscellaneous services son). For administered drugs, professional category. Spending per capita was lab/path services, and professional higher for the miscellaneous category Utilization of Professional Ser- radiology services, use generally de- than for the other detailed service vices clined over the study period. Use of categories, but spending on any single In 2012, the most common type of administered drugs declined by an service was highest for surgical ser- doctor visit, on average, was office average annual 2.7%, use of lab/path vices: $278 per person in 2015 visits to PCPs. However, the rate of services by an average annual 0.6%, (Appendix Table A20). However, sur- use of office visits to PCPs declined and radiology services by an average gical services had the slowest growth each year studied, while the rate of annual 2.2% (Appendix Table A23). rate of the four detailed service cate- use of office visits to specialists in- One of the professional services with gories; spending per capita grew an creased each year (Figure 10). By the highest utilization rate was lab/ average annual 0.3%, or just $3 per 2015, the use of specialist office visits path services, which was higher than person over the study period. was higher than the rate for PCP of- the utilization rate of all types of doc- Administered drugs followed a pat- fice visits: 1,514 office visits to spe- tor visits; in 2015, there were 4,519 tern similar to the other professional cialists per 1,000 insured and 1,344 lab/path services per 1,000 insured services categories. Between 2012 office visits to PCPs per 1,000 insured compared to 3,348 doctor visits per and 2015, per capita spending on ad- (Appendix Table A23). Small increas- 1,000 insured. ministered drugs increased by an av- es occurred in the use of preventive Average Price and Intensity erage annual 6.4%, growing by $32 to visits both to PCPs and to specialists; $190 per person (Appendix Table the rate of use of these visits was In all years of the study, the average A20). In contrast, spending on profes- higher at the end of the study period price of most professional services sional radiology services declined than at the beginning. However, in- increased. The exception to this was www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 16 radiology services, which had a $1 age prices than visits to PCPs. In 2015, Professional Service Trends for average price decrease in 2015 after the highest average price was for pre- Age-Gender Groups $1 average price increases in the pre- ventive visits to specialists ($148 per For both boys and girls (ages 0-18), vious years (Appendix Table A24). visit) and the lowest was for office the highest use rates among the pro- Overall, the average price of a radiolo- visits to PCPs ($103 per visit). This fessional services were for office vis- gy service changed little --just $1 same trend held for the average in- its to PCPs. In 2015, there were 1,487 higher in 2015 than in 2012. Between tensity of a doctor visit. The highest PCP office visits per 1,000 boys and 2012 and 2015, lab/path services also average intensity was for preventive 1,508 per 1,000 girls (Appendix Table increased in average price, from $29 visits to specialists, while the lowest A27). Office visits to PCPs were the to $32 per lab/path service. The aver- was for office visits to PCPs most frequently used service in 2015, age intensity of a radiology and lab/ (Appendix Table A25). The average despite the fact that utilization for path service had opposite trends. intensity of each type of visit was both boys and girls declined between Over the study period, the average higher at the end of the study period 2012 and 2015, by 210 visits per intensity of a radiology service de- than at the beginning. Interestingly, 1,000 boys and 216 visits per 1,000 clined slightly, while the average in- once intensity was adjusted for, the girls. Over the same period, the utili- tensity of a lab/path service increased average intensity-adjusted price was zation of the other three types of doc- (Appendix Table A25). Similar to av- the same across all visit types. In tor visits increased for both boys and erage price, the intensity-adjusted 2015, the average intensity-adjusted girls. The largest increase was for of- average price of both radiology and price of each doctor visit type was fice visits to specialists by girls, which lab/path services was relatively sta- $42 (Appendix Table A26). increased by 154 visits per 1,000 ble over the study period (Appendix Among the professional services cate- girls, compared to an increase of 141 Table A26). (For more information gories, anesthesia services had the visits per 1,000 boys. about average price and intensity, see highest average price. The average “Decomposition key definitions”.) For men and women in all the adult price of anesthesia grew an average age groups (ages 19-24, 25-44, 45-54, The fastest average annual growth annual 2.0% over the study period, and 55-64), the highest use rate rate among the detailed category of increasing from $718 to $761 among the professional services was professional services was for admin- (Appendix Table A24). Similarly, the for lab/path services. Use of profes- istered drugs. Between 2012 and average price of a surgical service was sional lab/path services increased 2015, the average price of an adminis- high compared to other professional with age, and women had a higher tered drug increased an average an- services: $417 in 2015. Over the study utilization rate than men in each age nual 9.3%, from $409 to $534 period, the average intensity of anes- group (Appendix Tables A29-A36). (Appendix Table A24). The average thesia services was relatively stable, Also for men and women in the adult intensity of an administered drug while the average intensity of surgical age groups, the second highest utiliza- changed very little over the study pe- services increased slightly (Appendix tion rate was for office visits to spe- riod: 0.01 higher in 2015 than in 2012 Table A25). After adjusting for inten- cialists. However, this trend was true (Appendix Table A25). The average sity, the average intensity-adjusted only for 2013 through 2015; in 2012, intensity-adjusted price of an admin- price of anesthesia services remained the office visits to PCPs had higher istered drug was higher than for the the second-highest (after adminis- utilization rates for each adult age/ other professional services catego- tered drugs): $122 in 2015. The aver- gender group. Between 2012 and ries: $444 in 2015, up $101 over 2012 age intensity-adjusted price of surgi- 2015, the utilization rates of office (Appendix Table A26). cal services was much lower than the visits to PCPs declined, while the utili- unadjusted average price: $52 in The average price trends were rela- zation rates of office visits to special- 2015, which was similar to the aver- tively similar across the types of doc- ists increased. age intensity-adjusted prices of other tor visits, and the average price for professional services (Appendix Table each type grew about an average an- A26). nual 3% (Appendix Table A24). Over- all, preventive visits had higher aver- age prices than did office visits, and visits to specialists had higher aver- www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 17 Outpatient Services In 2015, spending for the ESI popula- tion on outpatient services was $1,427 per person (Table 1). Spend- ing on outpatient services accounted for just under 30% of total per capita spending. Over the study period, spending on these services rose by $153 per person, growing at an aver- age annual 3.9%. Of the $1,427 per capita spending on outpatient ser- vices, 62.4% was on outpatient visits ($890 per person); the rest was on outpatient-other services ($537 per person). Spending per capita over the study period grew at a faster rate for outpatient visits compared to outpa- tient-other services: an average annu- al 4.3% versus 3.2%. Between 2012 and 2014, the use of all outpatient services declined slightly studied, with outpatient visits having ries, although the average annual by 95 services per 1,000 insured to a faster average annual growth rate: growth rate was faster for outpatient 2,775 services per 1,000 (Table 3). 6.3% for outpatient visits versus 3.9% visits (6.0%) than for outpatient other Use increased by 1.0% the following for outpatient-other services. Similar- services (2.4%). year due to an increase in the use of ly, the average intensity of an outpa- outpatient-other services, which rose The remainder of this section details tient visit compared with an outpa- by 36 outpatient-other services per the spending, utilization, price, inten- tient-other service was almost 13 1,000 insured. Outpatient-other ser- sity, and unit price trends for the de- times higher. However, between 2012 vices also made up the bulk of the tailed categories of outpatient visits and 2014, the average intensity of an total outpatient use. In 2015, there and then for the detailed categories of outpatient-other service rose slightly were 2,496 outpatient-other services outpatient-other services. The de- each year, while the average intensity per 1,000 insured compared to 305 tailed categories of outpatient visits of an outpatient visit declined. In outpatient visits per 1,000. Over the are: emergency room (ER) visits, ob- 2015, the average intensity of an out- study period, the use of outpatient servation visits, and surgical visits. patient visit rose by a modest 3.3%. visits declined by 18 visits per 1,000 The detailed categories of outpatient- Interestingly, once average intensity insured. other services are: ancillary services was adjusted for, the average intensi- (e.g., ambulance, home health), labor- During the study period, the average ty-adjusted price of an outpatient visit atory and pathology (lab/path) ser- price and average intensity per outpa- was relatively similar to that of an vices, radiology services, and a cate- tient visit was much higher than for outpatient-other service: $160 per gory of the remaining “miscellaneous” outpatient-other services: in 2015, outpatient visit compared to $153 per outpatient services. $2,916 per outpatient visit versus outpatient-other service. As with the $215 per outpatient-other service unadjusted average price, the average Outpatient Visits (Table 3). The average price for both intensity-adjusted price increased HCCI examined spending, utilization, subservice categories rose each year each year for both subservice catego- price, intensity, and intensity- www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 18 adjusted price trends for the ESI type increased each year studied. The od. Over that period, the average in- study population’s outpatient visits. highest average price and the largest tensity-adjusted price of an outpa- HCCI’s detailed categories of outpa- increase in average price over the tient surgical visit grew just $16 to tient visits include emergency room study period was for outpatient surgi- $130. (ER) visits, observation visits, and cal visits (Appendix Table A24). Be- Outpatient-Other Services surgical visits. Of the three types of tween 2012 and 2015, the average outpatient visits, the highest per capi- price of a surgical visit rose by $686 HCCI examined spending, utilization, ta spending was on outpatient surgi- to $4,621. Over those years, the aver- price, intensity, and intensity- cal visits ($527 per person in 2015) age price of ER visits grew the fastest adjusted price trends for the ESI and the lowest was on observation (average annual 8.6%), but was the study population’s outpatient-other visits ($40; Appendix Table A20). lowest: $1,863 in 2015. The average services. HCCI’s subcategories of However the highest average annual price of an observation visit increased these services include ancillary ser- spending growth rate (7.2%) and the by $379 over the study period to vices (e.g., ambulance, home health), largest increase in spending ($60 per $2,233. laboratory and pathology (lab/path) person) over the time period was on services, radiology services, and Between 2012 and 2014, the average ER visits. Between 2012 and 2015, “miscellaneous” outpatient services. intensity across outpatient visit types spending on ER visits increased from Of these four detailed categories), the generally declined but increased in $262 per person to $322 per person. highest per capita spending was on 2015 (Appendix Table A25). Both In contrast, spending on observation outpatient radiology services. In observation and surgical visits had a visits changed little, increasing just $4 2015, spending on radiology services higher average intensity in 2015 than per person over the study period. was $196 per person, and spending in 2012. ER visits, however, had a Outpatient surgical visits saw moder- grew just $9 per person from 2012 slightly lower intensity (7.77) in 2015 ate per capita spending growth, which (Appendix Table A20). Spending on than in 2012 (7.79). After adjusting increased an average annual 2.7% or the miscellaneous category of ser- for intensity, observation visits had $40 per person. vices was similar ($189 per person in the highest intensity-adjusted price: 2015 but saw a faster average annual In contrast to per capita spending $243 in 2015 (Appendix Table A26). growth rate per capita than did radi- trends, which increased for each of That year, the average intensity- ology services: 6.1% compared to the services each year studied, the adjusted price of an ER visit ($240) 1.4%, respectively. In comparison, utilization rates for outpatient visits was similar, due to 8.7% average an- spending per capita on lab/path and generally declined over the study pe- nual price growth over the study peri- riod (Appendix Table A23). Only ER visits saw a modest increase of 1 visit per 1,000 insured in 2014. Between 2012 and 2015, the utilization rate of ER visits declined an average annual 1.3%, from 180 ER visits per 1,000 insureds to 173 per 1,000. Between 2012 and 2014, use rates for observa- tion visits were stable at 20 visits per 1,000 insured. In 2015, however, the use rate declined by 2 observation visits per 1,000 insured. The largest utilization rate decline for outpatient visits was for surgical visits, which fell an average annual 2.7%. Between 2012 and 2015, surgical visits per 1,000 insured fell from 124 to 114 visits. The average price for outpatient visit www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 19 ancillary services was half that of ($64 in 2015), and grew by just $4 surgery. In 2015, spending on outpa- spending on radiology and the miscel- between 2012 and 2015. Over those tient surgery for 25-44 year olds was laneous services, and changed little years, the average price of an ancil- $311 per man and $562 per woman over the study period. In 2015, spend- lary service increased from $179 to (Appendix Table A13); for 45-54 year ing on ancillary services was $83 per $200. olds, it was $667 per man and $914 person and $70 per person on lab/ per woman (Appendix Table A15); The average intensity of a lab/path path services. and for 55-64 year olds, $1,089 per and a radiology service was relatively man and $1,073 per woman The highest utilization rate among stable over the study period. Between (Appendix Table A17). outpatient-other services was for lab/ 2012 and 2015, average intensity for path (1,087 lab/path services per lab/path services rose just 0.02, re- For both genders in every age group 1,000 insured in 2015); radiology had mained the same for a radiology ser- studied, lab/path services had the the lowest utilization rate (375 radiol- vice, but rose moderately for ancillary highest utilization rate of the outpa- ogy services per 1,000; Figure 12 and services (0.16; Appendix Table A25). tient services. In contrast, use rates Appendix Table A23). Between 2012 In comparison, the average intensity for ER visits, which had increased for and 2014, the use of outpatient-other of an ancillary service increased mod- all adult age groups in 2014, declined services generally declined. However, erately, by 0.16, over the study peri- for some in 2015. Previously, HCCI in 2015, the utilization rates of ancil- od. After adjusting for intensity, the reported an increase in use rates for lary, lab/path, and the miscellaneous average intensity-adjusted price of a ER visits by the adult age groups in services increased slightly. These in- radiology service was similar to that 2014. Under the current analytic da- creases in use led, in part, to higher of a lab/path service: in 2015, $251 taset (see Data and Methods), this growth in total spending in 2015 and $206, respectively (Appendix utilization increase observation re- (4.6%) compared with the two previ- Table A26). The average intensity- mained unchanged (Appendix Tables ous years (3.0% and 2.6%). For the adjusted price of both types of ser- A27-A36). However, for men and category of miscellaneous services, vices generally increased each year women in the 19-24, 25-44, and 45- the utilization rate in 2015 (619 ser- studied. Only lab/path services in 54 age groups, this increase in the use vices per 1,000 insured) was higher 2015 saw a decline in the average of ER visits was not observed for than in 2012 (605 services per 1,000). intensity-adjusted price: 2.4%, or a $5 2015, and the largest decline in use For lab/path and ancillary services, per service decline. Over the study was for men and women ages 19-25 the rise in utilization in 2015 did not period, the average intensity-adjusted (a 10 visit per 1,000 men or women offset the declines in the prior years; price of an ancillary service increased decline; Appendix Table A29). In con- as a result, the utilization rates in from $54 per service $58 per service. trast, for both men and women in the 2015 were lower than those in 2012. oldest adult age group (ages 55-64), Outpatient Service Trends by Age- The use of radiology services dropped the utilization rate of ER visits re- slightly in each year, an average annu- Gender Groups mained stable in 2015: 144 ER visits al 0.9% decline. For the two youngest age groups per 1,000 55-64 year old men in 2014 (ages 0-18 and ages 19-24), for both and 2015, and 164 ER visits per 1,000 While radiology services had the low- genders, the highest spending per 55-64 year old women (Appendix est utilization rate of the detailed cat- capita on a detailed category of outpa- Table A35). egories of outpatient-other services, it tient services was on ER visits. In had the highest average price per ser- 2015, spending on ER visits was $224 vice ($522 per radiology service in per boy and $220 per girl (Appendix 2015; Appendix Table A24). This Table A9), and was $281 per 19-24 higher average price led to the high- year old man and $432 per 19-24 est per capita spending ($196 per year old woman (Appendix Table person), as discussed above. The av- A11). For the three older adult age erage price of a radiology service groups (ages 24-44, 45-54, and 55- grew modestly over the study period, 64), the highest spending per capita increasing an average annual 2.4%. on a detailed category of outpatient Comparatively, the average price of a services for both men and women in lab/path service was much lower each age group was on outpatient www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 20 Acute Inpatient Admissions Spending on acute inpatient admis- sions made up about 20% of total per capita spending for the ESI population during the study period. In 2015, spending on acute admissions was $997 per person (Table 1). Between 2012 and 2015, spending per capita increased by $53 – less than half of the spending increase on outpatient services and professional services over that same period. Spending per capita on acute admissions increased by an average annual 1.9%, a slower average growth rate than found for all other subservice categories. Use rates for acute admissions were much lower than rates for the other medical services categories. Between 2012 and 2015, acute admissions per 1,000 insured fell from 56 admissions Inpatient admissions to hospice or admissions (Appendix Table A20). to 50 admissions (Table 3). Compara- skilled nursing facilities (SNFs) and Surgical admissions also saw the larg- tively, in 2015, the use rate for outpa- admissions that were ungroupable est increase in per capita spending tient visits was 6 times higher than are not discussed here, as they are over the study period: $25 per per- the rate for acute admissions. relatively rare in the younger than 65 son, or 1.7% spending growth. Medi- In contrast to low use rates, the aver- ESI population (combined, there were cal admissions had the second highest age price per service was highest for 2 admissions per 1,000 insured in per capita spending: $296 in 2015. acute admissions among the medical each year of the study period). Per capita spending on medical ad- services categories. In 2015, the aver- missions was relatively stable over age price for an acute admission was Spending on Acute Admissions the study period, rising by just $4 per $19,967. The average price increased HCCI examined spending, utilization, capita between 2012 and 2015. each year studied, by an average an- price, intensity, and intensity- The other three admissions categories nual $1,006. Between 2012 and 2015, adjusted price trends for the ESI pop- – LD, MHSU, and newborn – each had the average intensity of an acute ad- ulation’s acute admissions services. spending below $100 per capita mission was relatively stable. After HCCI’s subcategories of these services (Appendix Table A20). The highest adjusting for intensity, the average include medical admissions, surgical spending was on LD admissions ($95 intensity-adjusted price of an acute admissions, mental health and sub- per person in 2015), followed by admission in 2015 was $14,889. The stance use (MHSU) admissions, labor spending on newborn admissions average intensity-adjusted price of an and delivery (LD) admissions, and ($55 per person), and spending on acute admission increased each year newborn admissions. Of these types MHSU admissions ($38 per person). studied by an average annual $587, of acute admissions, surgical admis- Spending per capita on these catego- compared with an average $1,006 a sions had the highest per capita ries of acute admissions increased year for the unadjusted price. spending: $513 per person in 2015, or over the study period. Between 2012 51.5% of the dollars spent on acute and 2015, spending increased by $9 www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 21 per capita for LD and newborn admis- lar terms, the increase in a surgical 2015, the average price of a LD admis- sions, and by $5 per capita for MHSU admission’s average price – $7,605 – sion and a MHSU increased by $1,065 admissions. was nearly twice as high as for a med- and $960, respectively, and grew at ical admission at $3,314. an average annual 4.3% and $3.9%, Utilization of Acute Admissions respectively. Surgical admissions and medical ad- As with per capita spending, utiliza- missions also had the highest and sec- Compared to medical and surgical tion rates were highest for surgical ond highest average intensity, respec- admissions, the other types of admis- admissions and medical admissions. tively, among acute admissions. The sions had lower levels of average in- In every year studied, the rate of use average intensity of a surgical admis- tensity (Appendix Table A25). In was slightly higher for medical admis- sion (2.58) was over twice as high as 2015, average intensity among the sions than for surgical admissions. In for a medical admission (1.06) in three remaining admission types was 2015, there were 17 medical admis- 2015 (Appendix Table A25). Over the highest for newborn admissions sions per 1,000 insured and 13 surgi- study period, average intensity for (0.90), followed by MHSU admissions cal admissions per 1,000 (Appendix both types of admissions increased (0.87), and LD admissions (0.69). Table A23). The use rates for both slightly. Over the study period, average inten- admission types declined slightly over sity changed little or not at all for the study period: medical admissions Notable, after intensity was adjusted these types of admissions. declined by 3 admissions per 1,000 for, the average intensity-adjusted insured and surgical admissions de- price of a medical admission was After intensity was adjusted for, the clined by 2 admissions per 1,000 in- higher than that of a surgical admis- average intensity-adjusted price of sured. sion: $16,697 for a medical admission LD, newborn, and MHSU admissions versus $15,370 for a surgical admis- were higher than their unadjusted The next highest use rates among sion in 2015 (Appendix Table A26). average price (Appendix Table A26). acute admissions were for LD admis- For both types of admissions, the in- Of these types of admissions, LD ad- sions. In 2015, there were 11 LD ad- tensity-adjusted price rose in every missions had the highest average in- missions per 1,000 insured, compared year studied. However, on an average tensity-adjusted price. Both LD and with 5 newborn admissions per 1,000 annual basis, the intensity-adjusted MHSU admissions saw moderate av- insured and 4 MHSU admissions per price for medical admissions com- erage annual intensity-adjusted price 1,000 insured (Appendix Table A23). pared with surgical admissions rose growth over the study period: 4.3%. The rate of use of LD, newborn, and faster (4.9% versus 4.6%) and in- Comparatively, the average intensity- MHSU admissions remained stable creased more in dollar terms ($2,230 adjusted price of a newborn admis- between 2012 and 2015. versus $1,953). sion between 2012 and 2015 grew Average Price and Intensity much slower, at an average annual Of the three less common types of 1.8%. Among acute admissions, surgical admissions, the highest average price admissions had the highest average was for newborn admissions: $10,320 Acute Admission Trends by Age- price and the largest average price in 2015 (Appendix Table A24). Over Gender Groups increase. Between 2012 and 2015, the the study period, the average price of Of all acute admissions, only LD and average price of a surgical admission a newborn admission saw moderate – newborn admissions, by their inher- rose by more than $7,000 to $39,671, as compared to the growth observed ent nature, are limited to certain age a 7.4% average annual increase for medical (7.2%) and surgical ad- and gender cohorts. LD admissions (Appendix Table A24). In comparison, missions (7.4%) – 4.8% average an- for women in the two oldest adult age the average price of a medical admis- nual growth; the average price in- groups were 0 per 1,000 women sion, the second highest price among creased by $1,362. In 2012, the aver- (Appendix Table A33 and A35). For acute admissions, was less than half age price of a LD admission was the the two younger adult age groups that observed for surgical admissions, same as for a MHSU admission: (ages 19-24 and 25-44), LD admis- at $17,689 in 2015. The average price $7,872. However, by 2015, the aver- sions had the highest rate of use of of a medical admission increased over age price of a LD admission was any type of acute admission. In 2015, the study period by an average annual slightly higher than for a MHSU ad- there were 35 LD admissions per 7.2%, similar to the 7.4% increase for mission, due to faster price growth for 1,000 19-24 year old women a surgical admission. However, in dol- LD admissions. Between 2012 and www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 22 (Appendix Table A29) and 61 LD ad- Among the other acute admissions in missions per 1,000 25-44 year old 2015, MHSU admissions for men ages women (Appendix Table A31). LD 19-25 had the highest use rate (11 admissions also accounted for the MHSU admissions per 1,000 men in largest share of per capita spending 2015), followed by women ages 19-25 on acute admissions for these two (8 MHSU admissions per 1,000 wom- groups of women (Figure 14): for en; Appendix Table A29). Utilization women ages 19-24, 41.7% ($276 per rates of both medical and surgical woman; Appendix Table A11) and for admissions increased with age, with women ages 25-44, 50.0% ($553 per the highest rates for the oldest adult woman; Appendix Table A13). LD age group (Appendix Table A35). In admissions spending accounted for the three youngest age groups, utiliza- much of the difference between men tion rates of medical and surgical ad- and women in those age groups in missions were similar with women’s spending on acute admissions. rates often slightly higher (Appendix Tables A27-A32). For both these ad- Use of newborn admissions is limited, missions, men’s use rates were higher by definition, to the children’s cohort. in the two oldest adult groups Newborn admissions made up the (Appendix Tables A33-A36). bulk of acute admissions use and spending per child. These admissions were slightly higher in use and per capita spending for boys (Appendix Tables A9 and A27). In 2015, spend- ing on newborn admissions was $226 per boy and $199 per girl (Figure 14 and Appendix Table A9). This $27 spending difference accounts for over 60% of the total difference in per cap- ita spending between boys and girls on acute admissions. www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 23 Prescriptions Over the study period, spending on scriptions in 2015, 67.3% was spent and 2015, the increase in generic pre- prescriptions accounted for just un- on brand prescriptions and the rest scription use did not offset the decline der 20% of total per capita spending, was spent on generic prescriptions in brand prescription use. In these making prescription spending the (Table 1).5 Spending per capita on years, net declines occurred in the use lowest in the four major health ser- both brand and generic prescriptions of prescriptions in total. However, the vice categories (Table 1). In 2015, increased in every year of the study use rate of total prescriptions was $964 per person was spent on pre- period. Average annual spending higher in 2015 (283,430 filled days of scriptions and per capita spending on growth rates were faster for brand prescriptions per 1,000 insured) than prescriptions increased every year of prescriptions than for generic pre- in 2012 (282,447 filled days per the study. During this time, spending scriptions: 7.1% compared to 4.5%, 1,000). growth on prescriptions was general- respectively. The average price of a filled day of a ly higher than spending growth for Use rates for prescriptions are meas- brand prescription nearly doubled the medical service categories. Be- ured in filled days per 1,000 insured. over the study period, increasing tween 2012 and 2015, spending per Between 2012 and 2015, the use rates from $10 per filled day to $19 per capita on prescriptions grew an aver- for generic prescriptions increased by filled day, or 24.8% average annual age annual 6.2% (compared with an average annual 3.0% (Table 3). At growth (Table 3). In contrast, the av- 3.9% for outpatient services, the high- the same time, use rates for brand erage price of a filled day of a generic est spending growth rate among the prescriptions declined by an average prescription remained stable at $1 medical admissions categories) and annual 14.2%. In 2013, the increase in per day. HCCI does not calculate in- rose by $159 per person (compared use of generic prescriptions was larg- tensity or intensity-adjusted price with $153 for outpatient services, the er than the decline in the use of brand metrics for prescriptions. highest dollar increase among the prescriptions. The result was a net medical admissions categories). HCCI examined the ESI population’s increase in the use of total prescrip- spending, utilization, and price trends Of the $964 spent per capita on pre- tions (brand plus generic). In 2014 for the detailed categories of brand prescriptions and generic prescrip- tions. Detailed categories are the same for both brand and generic pre- scriptions, and are based on the American Hospital Formulary System (AHFS) pharmacologic-therapeutic classification categories. They in- clude: anti-infective agents; cardio- vascular drugs; central nervous sys- tem (CNS) agents; eye, ear, nose, throat (EENT) preparations; gastroin- testinal (“gastro”) drugs; hormones and synthetic substitutes (“hormones”); respiratory drugs; skin and mucous membrane (“skin”) agents; and a category of the remain- ing “other” therapeutic categories of prescriptions. www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 24 Brand Prescriptions Of the detailed categories of brand prescriptions, the highest per capita spending was on the “other” category: $211 in 2015 (Appendix Table A20). Of the single classification categories, the highest spending was on brand hormones and brand anti-infective agents: $134 per person and $101 per person, respectively. The annual spending per capita on the remaining categories of brand prescriptions were less than $100. For half of the detailed categories of brand prescrip- tions, per capita spending increased over the study period. Between 2012 and 2015, the highest spending per capita increase was for brand anti- infective agents: from $53 per person to $101 per person. For cardiovascu- largest declines in use over that peri- of a brand prescription increased in lar drugs, CNS agents, EENT prescrip- od was for brand cardiovascular each year (Appendix Table A24). Mir- tions, and gastro drugs, per capita drugs and brand CNS agents. Use of roring the increase in per capita spending declined over the study pe- brand cardiovascular drugs fell from spending on detailed categories of riod. The largest spending decline 13,385 filled days per 1,000 insured brand prescriptions, the largest in- over the study period was for brand to 6,646 filled days per 1,000 insured, crease in the average price per filled CNS agents at $24 per person. while use of brand CNS agents fell day was for brand anti-infective Use rates for all brand prescription from 9,901 filled days per 1,000 in- agents. Between 2012 and 2015, the categories but one declined in all sured to 4,738 filled days per 1,000 average price per filled day of a brand years studied (Appendix Table A23). insured. Brand hormones had the anti-infective agent more than dou- The exception was in the use of brand highest use rate in 2015: 10,702 filled bled, from $35 per filled day to $83 respiratory drugs in 2015 – a small days per 1,000 insured. By contrast, per filled day, an average annual price increase of 127 filled days per 1,000 at the beginning of the study period in increase of 35.7%. The average price insured. The smallest decline in use 2012, brand cardiovascular drugs had per filled day for the “other” category between 2012 and 2015 was for the highest use rate. of brand prescriptions also more than brand anti-infective agents, by 310 doubled over they study period, in- As utilization of the categories of filled days per 1,000 insured to 1,214 creasing by $26 per filled day to $53 brand prescriptions generally de- filled days per 1,000 insured. The in 2015. The average price per filled clined, the average price of a filled day GROWTH IN SPENDING PER CAPITA ON BRAND ANTI-INFECTIVE AGENTS BETWEEN 2012 AND 2015 Between 2012 and 2015, spending on brand anti-infective agents nearly doubled, rising from $53 per person to $101 per person (Figure 16 and Appendix Table A37). In 2012, the highest spending per capita on types of brand anti- infective agents was on brand antiretrovirals ($27 per person; AHFS 08:18.08) followed by brand tetracyclines ($7 per person; AHFS 08:12.24). Antiretrovirals are medications used to treat retroviral infections, often HIV. Tetracy- clines are antibiotics used to treat bacterial infections. By 2015, per capita spending on tetracyclines had declined slightly, to $5 per person. Spending on antiretrovirals, in contrast, increased steadily each year to $39 per person. Ad- ditionally, the highest spending per capita on a type of brand anti-infectives was on protease inhibitors. In 2012, spending on brand protease inhibitors (AHFS 08:18.40) was $5 per person; by 2015, spending had increased to $48 per person. Spending per capita on brand antiretrovirals and protease inhibitors in 2015 made up 86.1% of the spend- ing on all brand anti-infective agents. www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 25 day for the other brand prescription EENT prescriptions declined slightly capita on brand prescriptions, while categories saw comparatively modest each year studied, and use of generic women had higher spending per capi- price increases—less than $15 per anti-infective agents declined be- ta on generic prescriptions (Appendix filled day between 2012 and 2015. tween 2012 and 2014, with a slight Table A17). This trend mirrors that increase in the utilization rate in for utilization of prescriptions. Men in Only for generic skin agents was this 2015. this age group had a higher utilization increase in price a large percentage of rate for brand prescriptions, while the total price, as the average per day Compared to the average price per women had a higher utilization rate doubled between 2012 and 2015. filled day for categories of brand pre- for generic prescriptions (Appendix scriptions, their generic counterparts Generic Prescriptions Table A35). For the oldest adult men, had much lower average prices the highest spending per capita on a Of the detailed categories of generic (Appendix Table A24). Only generic single detailed category of prescrip- prescriptions, the highest spending skin agents had an average price per tions was on brand anti-infective per capita was on CNS agents ($97 filled day greater than $3 in any year agents ($379 per man in 2015) fol- per person in 2015), followed by the studied. Generally, for any type of lowed by brand hormones ($352 per “other” category ($62 per person; generic prescription, the average man; Appendix Table A17). Interest- Appendix Table A20). Spending on price per filled day was either $1 or ingly, in 2012, the highest spending the rest of the generic prescription $2 and remained that price in every per capita on a detailed category of categories was under $40 per person year of the study period. prescriptions was on brand cardio- in 2015, and generally increased over Prescription Trends for Age- vascular drugs ($277 per man). the study period. The largest increase Gender Groups Spending per capita on brand cardio- in spending was for generic skin vascular agents declined each year agents, for which spending more than For the youngest age group (ages 0- studied, while per capita spending on doubled from $14 per person in 2012 18) and the oldest age group (ages 55 brand anti-infective agents and brand to $30 in 2015. Per capita spending -64), boys and men had higher spend- hormones increased each year (see on cardiovascular drugs and EENT ing per capita on prescriptions than “Growth in spending per capita on prescriptions both declined slightly girls and women in these age groups brand anti-infective agents between over the study period. (Appendix Tables A9and A17). For 2012 and 2015”). For the oldest adult boys, per capita spending was higher The generic prescription categories women, the highest spending on a than for girls on both brand and ge- with the highest utilization rates in all single detailed category of prescrip- neric prescriptions (Appendix Table years studied were generic CNS tions in 2015 was on brand hormones A7). For boys and girls, the highest agents ( 67,336 filled days per 1,000 ($297 per woman) followed by gener- per capita spending on detailed cate- insured) followed by generic cardio- ic CNS agents ($195 per woman). The gories of prescriptions (both brand vascular drugs (66,745 filled days per detailed category of prescriptions and generic) was on generic CNS 1,000 insured; Appendix Table A23). with the highest utilization rate in agents, followed by brand hormones These two categories also had the 2015 was generic cardiovascular and brand CNS agents (Appendix Ta- largest increase in utilization rates drugs: 264,619 filled days per 1,000 ble A9). In 2015, spending on generic over the study period. Between 2012 men and 187,561 filled days per CNS agents was $79 per boy and $42 and 2015, use of generic CNS agents 1,000 women (Appendix Table A35). per girl. Spending on brand hormones and generic cardiovascular drugs in- was $75 per boy and $41 per girl, For the three middle adult age groups creased by 5,563 filled days per 1,000 while spending on brand CNS agents of adults (ages 19-24, ages 25-44, and insured and by 6,756 filled days per was $55 per boy and $31 per girl. Ge- ages 45-54), spending per capita and 1,000 insured, respectively. Also, use neric CNS agents also had the highest utilization of prescriptions was higher of generic hormones was high com- use rate for both boys and girls: for women than for men (Appendix pared to use of the other generic pre- 20,833 filled days per 1,000 boys and Tables A11-A16 and A29-34). Pre- scription categories. Between 2012 16,647 filled days per 1,000 girls scription per capita spending in- and 2015, use of generic hormones (Appendix Table A27). creased with age, as did the utilization increased by 4,412 filled days per of prescriptions. For men in the 1,000 individuals to 43,557 filled days For the oldest adult age group (ages youngest adult age group (ages 19- per 1,000 in 2015. Use of generic 55-64), men had higher spending per 24), the highest per capita spending www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 26 and utilization of a single detailed category of prescriptions was for ge- neric CNS agents: $63 per man and 27,842 filled days per 1,000 men in 2015 (Appendix Tables A11 and A29). For women, the 19-24 age group, the highest spending per capita on a sin- gle detailed category of prescriptions was $71 per woman on brand hor- mones, while the highest utilization rate was for generic hormones (85,705 filled days per 1,000 women; Appendix Tables A11 and A29). For men in the 25-44 and 45-54 age groups, the highest per capita spend- ing on a single detailed category of prescriptions in 2015 was on brand anti-infective agents: $109 per man and $237 per man in 2015, respec- tively (Appendix Tables A13 and A15). For men ages 25-44, as with men ages 19-24, the highest utiliza- tion rate was for generic CNS agents: 44,074 filled days per 1,000 men (Appendix Table A31). For men ages 45-54, as with the oldest age group of men ages 55-64, the highest utiliza- tion rate was for generic cardiovascu- lar drugs: 135,872 filled days per 1,000 men (Appendix Table A33). For women in the 25-44 and 45-54 age groups, the highest per capita spend- ing on a detailed category of prescrip- tions in 2015 was on brand hor- mones: $113 per 25-44 year old wom- an and $172 per 45-54 year old wom- an (Appendix Tables A13 and A15). The highest utilization rate for wom- en in both age groups was for generic CNS agents: 81,508 filled days per 1,000 25-44 year old women and 135,339 filled days per 1,000 45-54 year old women (Appendix Tables A31 and A33). www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 27 Spending Per Capita in Selected States in 2015 For the first time, HCCI presents per capita health care spending and per capita out-of-pocket spending trends by state. We have chosen 18 states (including the District of Columbia) that meet our reporting criteria and public re- porting rules. The selected states are geographically distrib- uted , and indicate variation in per capita spending. These states are not meant to be a representative sample of all states or of the population in the states. Spending is at- tributed to insured based on their zip code in the member enrollment data file. Trends are presented for: Arizona, Col- orado, District of Columbia (DC), Florida, Georgia, Illinois, Kentucky, Maryland, Nevada, New York, Ohio, Oklahoma, Oregon, Tennessee, Texas, Virginia, Washington, and Wis- consin. In 2015, of these states, 11 had lower per capita spending than the national average and 7 had higher per capita spending than the national average (Table 4). Of these 18 states, Maryland ($4,559 per person) and Arizona ($4,528 per person) had the lowest spending, while Texas ($5,676 per person) and Wisconsin ($5,773 per person) had the highest. In 2015, average out-of-pocket spending for the ESI popula- tion nationally was $813 per person (Table 4). In contrast to total per capita spending, just eight of the selected states had lower than the national average out-of-pocket spend- ing. Colorado, Tennessee, Kentucky, and Oklahoma had to- tal per capita spending that was lower than the national average, but their out-of-pocket per capita spending was higher than the national average. In contrast, New York had higher than the national average total per capita spending ($5,593) and lower than the national average out-of-pocket spending ($812), the only selected state where we observed this trend. Of the selected states, the lowest per capita out- of-pocket spending was in DC ($636) followed by Maryland ($682), while the highest was in Texas ($983). www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 28 Data & Methods Data through 2014 from the original three Limitations data providers, though refreshed over The subset of HCCI’s data holdings This report had several limitations time, were considered 100% adjudi- used here contains de-identified com- that affect the generalizability and cated in 2014. Additionally, HCCI add- mercial health insurance claim lines interpretation of the findings. For this ed health care claims from a fourth for the years 2012 through 2015. For reason, HCCI considers the work a major health insurer for the years the first time, four major health insur- starting point for analysis and re- 2012 through 2015. ers contributed data to HCCI for the search on individuals covered by ESI purposes of producing a national, HCCI used the weighted, actuarially rather than a conclusive analysis of multi-payer, commercial health care completed dataset to estimate per the ESI population’s effect on health claims database. Data used for this capita health expenditures, average care in the United States. report include claims for individuals prices, utilization of services, average First, our findings were estimates for covered by group insurance through intensity, and average intensity- the U.S. ESI population ages 0 through an employer (fully insured and ad- adjusted prices for 2012 through 64, based on a sample of approxi- ministrative services only). The 2015. HCCI did not adjust dollar fig- mately 26% of these insureds. claims data include prices paid to pro- ures for inflation; thus, all reported viders by both insurers and insureds expenditures and prices were in nom- Second, the analysis and results were and details about the services used. inal dollars. descriptive, and the findings were not HCCI’s claims data are compliant with causal and cannot be used to deter- HCCI analyzed four major categories the Health Insurance Portability and mine causal relationships. of services, several subservice catego- Accountability Act (HIPAA). Third, the effect of individual or popu- ries, and detailed service categories For this report, HCCI analyzed a sub- (see “Key definitions”). Inpatient facil- lation health status, such as existence set of data totaling about 4 billion ity claims were from hospitals, skilled of chronic conditions, was not specifi- claim lines for approximately 39 mil- nursing facilities (SNFs), and hospices cally investigated or discussed in the lion insured per year (2012–2015). for which detail was sufficient to report. This analytic dataset consisted of all identify an overnight stay by an in- Fourth, HCCI does not report on pre- claims for insureds younger than age sured. Outpatient facility claims did miums or their determinants. 65 and covered by ESI and represent- not entail an overnight stay, and in- ed about 26% of the national ESI pop- cluded observation and ER services. Changes in 2015/2016 ulation. It is one of the largest da- Both outpatient and inpatient claims HCCI’s analytic methodology under- tasets on the privately insured ever consisted of only the facility charges went a number of changes to enhance assembled. associated with such claims. Profes- reporting for the 2015 Health Care sional services included claims billed Cost and Utilization Report. (See the Methods by physicians and non-physicians methodology document available on The analytic subset was weighted according to the industry’s standard HCCI’s Website for details on these using U.S. Census Bureau age-gender- procedure-coding practices. Prescrip- changes.)1 Two of those changes are geographic-based estimates of the ESI tion data reflected prescriptions filled notable. First, health care claims data population to make the analytic sub- at both retail and mail-order pharma- from a fourth insurer was included in set representative of the national ESI cies. the analytic dataset, which limits the population younger than age 65. direct comparability of this report For a more detailed description of Claims from 2014 and 2015 were ac- with previous Care Cost and Utiliza- HCCI’s methodology, dataset, and tion Reports. Second, In October 2015, tuarially completed to account for changes made for this report, see the the health care system transitioned claims that had been incurred but not Analytic Methodology on HCCI’s Web- from using ICD-9 codes to ICD-10 adjudicated. Claims for years 2012 site. 1 www.healthcostinstitute.org 2015 Health Care Cost and Utilization Report 29 codes. To maintain consistent classifi- cation of health care claims, claims that had ICD-10 codes were matched to the old ICD-9 codes. HCCI’s meth- odology document provides lists of the classification schemes used for both ICD-9 and ICD-10 codes. Endnotes 1. Health Care Cost Institute. 2015 Health Care Cost and Utilization Report Analytic Methodology v.5.0. Health Care Cost Institute, Nov. 2016 Web. 2. McEvoy, Gerald K., ed. AHFS Drug Information. Bethesda, MD: American Society of Health- System Pharmacists, 2015. PEP- ID. Web. 3. Yamamoto, Dale H. “Health Care Costs from Birth to Death.” Health Care Cost Institute, 2013:1 -39. Society of Actuaries. Web. 4. U.S. Census Bureau. 2015 Ameri- can Community Survey 1-Year Estimates, Median Age by Sex. 2016. 5. Per capita spending on brand prescriptions plus spending on generic prescriptions does not add up to the total per capita spending due to a small percent- age of the prescriptions claims that are not identifiable as either brand or generic, these totaled to $2 per capita in 2015. These “ungroupable” prescriptions are eliminated from the discussion here. www.healthcostinstitute.org Trends in Per Capita Spending for Children (2012–2015) Children have unique health care needs, which change over different stages of life. Variations in per capita health care spending across children’s age groups in part reflect these changes. In this section, HCCI provides a brief overview of the 2015 per capita spending and growth in spending trends for children. In addition, we present a notable trend in utilization, which helped to drive the rising growth of per capita spending among children in 2015. These trends are reported for five age groups of children covered by employer-sponsored insurance (ESI): infants and toddlers (“babies,” ages 0–3), younger children (ages 4–8), pre-teens (ages 9–13), and teenagers (ages 14–18). Health care spending per capita for children varied with age. In 2015, per capita spending for babies was $5,095 (Appendix Table A38). This was the highest spending per capita among any children’s age group. Per capita health care spending for younger children was $1,866; the lowest spending among any children’s age group (Appendix Table A39). Beginning with younger children, health care spending per capita increased with age. Among the two older children’s age groups, per capita spending was $2,017 for pre-teens and $3,002 for teenagers (Appendix Tables A40 and A41). Across each children’s age group, per capita spending increased at a faster rate in 2015 than in the previous year. Younger children had the fastest per capita spending growth rate among any children’s age group in 2015, rising by 6.9% (Appendix Table A39). This per capita spending growth rate was faster than the growth rate observed for the entire ESI population (ages 0–64) in 2015, which rose by 4.6% (Table 1). Pre-teens had the slowest growth rate of per capita spending among any children’s age group in 2015 (4.6%), equal to the spending growth rate for the total ESI population (Appendix Table A40). One reason that children’s per capita health care spending grew faster in 2015 than in the prior year was due to an increase in spending on administered drugs. This increase in spending per capita was observed for every children’s age group (Appendix Table A42). Higher utilization was a key driver for increased spending on administered drugs. In 2015, use of administered drugs rose for each age group of children (Figure 17). This was the first year during the study period where we observed utilization growth across every children’s age group. The largest increase in use was observed for teenagers (6.5%), an increase in use of 11 administered drugs per 1,000 teenagers. Pre-teen children had the smallest increase in administered drug utilization (2.8%), an increase of 7 administered drugs per 1,000 pre-teens. In contrast, utilization of administered drugs by the entire ESI population (ages 0–64) fell in 2015, by 3.4% (Appendix Table A23). 1100 G Street NW, Suite 600 Washington, DC 20005 202-803-5200 www.healthcostinstitute.org Copyright 2016 Health Care Cost Institute Inc. Unless explicitly noted, the content of this report is licensed under a Creative Commons Attribution Non-Commercial No Derivatives 4.0 License