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U.S. Healthcare Costs Climb 5.73% Over 12 Months

John Commins, for HealthLeaders Media, October 24, 2011

The Hospital and Professional Services Indices reported increases of 5.43% and 5.84%, respectively, from their August 2010 levels. For the Hospital Index, this rate is slightly higher than the + 5.31% posted in July 2011. The Professional Services Index is marginally lower than its +5.89% rate posted in July. 

"The increasing growth rate for hospitals is primarily due to rising rates of employment and wages," Blitzer said. "Professional services wages have also seen increasing rates during 2011; however, employment trends have declined over the same period."

The S&P Healthcare Economic Indices estimate the per capita change in revenues accrued each month by hospital and professional services facilities for services provided to patients covered under traditional Medicare and commercial health insurance programs. The annual growth rates are determined by calculating a percent change of the 12-month moving averages of the monthly index levels versus the same month of the prior year, S&P said.

"As we caution every month, these indices represent total costs not just prices, so increased costs could be due to prices going up, increased utilization, or some combination of the two," Blitzer said.

The highest annual growth rate for the S&P Composite index in the past six years was during the 12 months ending May 2010, when it posted +8.74%. 


John Commins is a senior editor with HealthLeaders Media.

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