Even after adjusting for inflation, costs of healthcare for seniors increased by about $2,000 per person over age 65 between 1996 and 2006, and Medicare paid a higher portion of the bill.
That's the finding from a new Agency for Healthcare Research and Quality report that analyzed per capita spending for prescription drugs, physician office visits, dental care, and hospitalization.
That $2,000 is an increase of about one-third. In 1996, for example, senior healthcare expenses were $6,989 per person, but grew to $9,080 in 2006. Of those four types of care, prescription drug purchases increased the most, 66%, from $105 to $174; while the cost of a physician's office visit increased 58%, from $114 to $180 per visit.
Because of Medicare Part D's implementation in 2006, Medicare paid a significantly greater portion of prescription drug expenses, taking the burden away from seniors' out-of-pocket expenses and private insurance.
The cost of a dental visit also rose significantly, from $187 to $254, while the price tag for a day as an inpatient in a hospital rose from $2,271 to $2,714.
Not all costs rose, however. The proportion of expenses attributed to home healthcare declined slightly, from 14.9% in 1996 to 6.6% in 2006.
Overall, senior healthcare expenses rose $100 billion in those 10 years, after adjusting for inflation, from $227.3 billion to $333.3 billion.
Other interesting facts from the study include:
- Medicare paid a significantly higher portion of the total healthcare bill for seniors in 2006 (60.9%) compared with 1996 (56.5%), while a smaller percentage was paid by private insurance, (14.1% versus 18.8%).
- In each year, fewer than one in 20 seniors had no medical expenses.
- At the top and the bottom end of the spending spectrum, one-fourth of the elderly had annual expenses exceeding $9,289 while one-fourth had expenses under $1,752 or no expenses.
- The percentage of seniors with expenses in dental care, prescription drugs, physician office visits, and hospitalization expenses did not change significantly between 1996 and 2006, but the portion of expenses attributed to emergency room care was "notably higher" in 2006 (20.4%) versus 1996, (13.2%).
- Hospital care expenses for inpatient care declined from 43.2% to 37.2%, but the portion for ambulance service increased from 23.4% to 28.7%.
The statistics were culled from the Medical Expenditure Panel Survey Household and Medical Provider Components for civilians. All costs were adjusted to 2006 dollars. The federal study included cost figures for 34.1 million people age 65 and over in 1996, and 38 million seniors in 2006.
Sources of payment included in the report included those paid by the service user or another family member, private insurance, Medicare, Medicaid/SCHIP, Indian Health Services, military providers, and other care provided by the federal government, state, and local clinics.