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53% of Consumers 'Oblivious' to Healthcare Costs

John Commins, for HealthLeaders Media, December 13, 2012

Most consumers have no idea how much they pay for healthcare beyond premiums and co-pays.

Until they do it will be difficult to temper the rate of cost growth in healthcare, says Paul H. Keckley, PhD, executive director of the Deloitte Center for Health Solutions.

"Our surveys show that about 53% of consumers are oblivious to costs and tend to go along with whatever is suggested. Only one in 10 is inclined to be price sensitive," Keckley says.

"That is a pretty bad starting point for reducing healthcare costs, especially if the incentives in the system are for doing more, which leads doctors and providers to recommend tests and surgeries that shouldn't be done, or even medications that don't work."

A study from Deloitte—The hidden costs of U.S. health care: Consumer discretionary health care spending—finds that out-of-pocket expenses accounted for about 13% ($402 billion) of the estimated $3.2 trillion in healthcare spending in 2010.

Government spending accounted for 40% of the spending. Of this, Medicare accounted for 16% ($527 billion); Medicaid, around 13% ($404 billion); and other public spending just under 11% ($346 billion). Private insurance paid for 27% of expenditures ($861 billion).

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