The average per capita cost of healthcare services covered by commercial health plans and Medicare programs rose 6.29% over the last 12 months ending in January, the first time the rate has accelerated since May 2010, according to Standard & Poor's Healthcare Economic Indices.
A further S&P breakdown shows that Medicare's growth in per capita cost grew at 3.4% in the 12-month period ending in January, which was less than half the rate of cost growth for commercial plans, which saw an increase of 8.03% for the 12-month period.
Healthcare cost increases continue well above the rate of inflation in the larger economy, which grew 2.1% for the 12-month period ending in February as measured by the Consumer Price Index. Most of that growth was fueled by rising food and energy costs, the Bureau of Labor Statistics reported.
David Blitzer, managing director and chairman of the Index Committee at S&P noted that January marked the first acceleration of the rate of growth in per capita healthcare services since May 2010. "The first month of the New Year shows a departure from this trend, but it's too soon to predict if this is an anomaly or a sign of what 2011 has in store for us," Blitzer said.
Blitzer said the rate of growth in expenditures for commercial health plans continues to outpace that of Medicare – as it has for most of the six year history of the measurement – and the gap has widened by three percentage points in the past year.
In 2010, the average per capita cost of healthcare services covered by commercial health plans and Medicare programs rose 6.06%, matching the lowest growth rates in four years. A further S&P breakdown for 2010 shows that – even with its older, sicker population and higher utilization, Medicare's growth in per capita costs – at 3.27% in 2010 – was less than half the rate of cost growth for commercial plans, which saw an increase of 7.75% for the year.
The S&P 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.
The Standard & Poor's Healthcare Economic Indices for January may be viewed here.
John Commins is the news editor for HealthLeaders.