Health Care Costs To Increase by 6.8% in 2015, PwC Report Says
Health care costs are poised to jump by 6.8% in 2015, up from a 6.5% projected increase this year, according to a new report from PricewaterhouseCoopers' Health Research Institute, the Wall Street Journal's "MarketWatch Health Exchange" reports.
The projected growth in health care costs marks the first health care inflation increase in several years (Britt, "MarketWatch Health Exchange," Wall Street Journal, 6/24).
According to Modern Healthcare, the projected increase follows decelerated growth in medical costs for several consecutive years after the economic downturn in 2009, compared with annual double-digit increases in the 1990s and early 2000s (Demko, Modern Healthcare, 6/24).
For the report, PwC interviewed health care policymakers, executives and actuaries whose companies provide health care coverage to a combined 93 million U.S. residents. Researchers also surveyed more than 1,000 employers from 35 industries and examined conference proceedings, government data and journal articles (PwC report, 6/24).
PwC analysts pointed to the economic recovery and changes in the health industry over the past several years -- such as the enactment of the Affordable Care Act, consolidation of physician practices and hospitals and a greater shift toward higher-deductible health plans -- for driving the cost growth ("MarketWatch Health Exchange," Wall Street Journal, 6/24). They also noted that providers are shifting some of the costs to implement electronic health record systems to consumers (Al-Faruque, The Hill, 6/24).
A separate PwC study predicted changes in patient behavior as employers and insurers continue to increase deductibles and provide other incentives to reduce medical costs. Analysts noted that those changes could slow the growth in medical costs to 4.8% in 2015, according to Kaiser Health News' "Capsules."
Meanwhile, high-deductible health plans, improved coordination of care, and payment incentives that reward quality care and penalize low-quality care can put downward pressure on costs, analysts noted.
Their report found that two-thirds of companies surveyed offered high-deductible health plans and nearly one-fifth of them only offered such plans (Hancock, "Capsules," Kaiser Health News, 6/24). Forty-four percent said they were considering only offering only high-deductible plans to their employees ("MarketWatch," Wall Street Journal, 6/24). In addition, about one-third were considering offering coverage from a private insurance exchange, which typically provide a wide variety of coverage options, including high-deductible plans (Modern Healthcare, 6/24).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.