US Healthcare Costs Grew 5.28% in 2011

John Commins, February 22, 2012

The average per capita cost of healthcare services covered by Medicare programs and commercial insurance grew by 5.28 % in 2011, nearly double the rate of inflation in the larger economy, Standard & Poor's Healthcare Economic Indices show.

A further breakdown of S&P data shows that healthcare costs covered by commercial insurance plans grew by 7.11% in 2011, while Medicare claim costs rose by 2.51%, despite the government plans' older and sicker population.

Healthcare costs easily outpaced the 3% growth in overall inflation as measured by the Consumer Price Index for 2011, according to Bureau of Labor Statistics data.

Robert Zirkelbach, a spokesman for America's Health Insurance Plans, told HealthLeaders Media that commercial plans must contend with cost-shifting and other market forces that do not affect Medicare. He says the cost growth acceleration also could be link to the recovering economy.

"When the acceleration slowed in the last couple of years, a lot of it had to do with the slowdown in the economy," Zirkelbach said. "People were using fewer healthcare services. That also resulted in changes in the risk pool, where younger and healthier workers chose to forego coverage, or when employers were laying off employees it was often the younger workers that tended to be the first to go. So that resulted in a risk pool that tended to be older and have higher healthcare costs."

John Commins

John Commins is a senior editor at HealthLeaders Media.

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