Massachusetts Health Policy Commission Cost Trends Report

The Massachusetts Health Policy Commission released its preliminary cost trends report for 2013. In case anyone needed confirmation, Massachsuetts health care costs are above the national average.

The report says: “Spending in Massachusetts is the highest of any state in the U.S., crowding out other priorities for consumers, business, and government.”

Massachusetts Health Policy Commission 2013 Preliminary Cost Trends Report

The Massachusetts Medical Society summarized the report on its blog. Here are a few excerpts:

• Massachusetts is No. 1 in the country for personal health care expenditures:
  • Massachusetts: $9,278 per person
  • U.S.: $6,815
  • If you adjust the data for our older population, broad access to care, and higher overhead costs (wages, rent, supplies, etc.) the difference is still 20%.

• For private health insurance patients:
  • Hospital spending is 42% higher than the U.S. average
  • Long term care spending is 31% higher
  • Professional services spending is 24% higher (physician, clinical, dental and other services)
• Why do we spend more? Higher utilization and higher unit prices
• Hospital utilization
  • Inpatient admissions: 10% higher
  • Average length of stay: 7% lower
• Outpatient  utilization
  • Patient visits, excluding emergencies: 72% higher
  • Outpatient surgeries: 27% higher
• Why are prices higher? Higher fee schedules, and more care is delivered in higher-priced settings
  • Fees paid by commercial payers, Medicare and Medicaid are higher than the national average
  • Portion of Mass. discharges from major teaching hospitals: 41% 
  • Portion of U.S. discharges from major teaching hospitals: 16%

Check out the rest of the HPC report highlights. A more detailed report will be forthcoming in the new year.

Most of the data used in compiling the report is from 2009. More recent data from around the country has shown a slowing of health care cost increases, independent of the economic slowdown. It remains to be seen whether the older Massachusetts numbers are still relevant today.

David Harlow
The Harlow Group LLC
Health Care Law and Consulting