Healthcare Financial Management Association
Perhaps we’ve seen an end to double digit increases with respect to healthcare costs. According to a recent study by Standard and Poor’s costs continue to rise but at a slower pace. What’s interesting about the report is that the Federal Government is doing a better job at containing rising costs than commercial insurers.
The average per capita cost of healthcare services covered by commercial insurance and Medicare programs continued to rise in the 12-month period ending in March, but the rates of increase have slowed down since the index hit its all-time peak in May 2010, according to the Standard & Poor’s (S&P) Healthcare Economic Composite Index.
The 5.77 percent increase in March nearly matched the lowest annual growth rate in the six-year history of the index, which recorded a 5.76 percent increase in June 2007. Since the all-time high of 8.74 percent in May 2010, the index has declined 2.97 percent in 10 months.
“It is apparent that the rates of increase in healthcare costs continue to slow down,” said David M. Blitzer, chairman of the S&P Index Committee. “While there has been some volatility within months, the general trend has been a slowdown. Costs for Medicare patients are being better contained than those covered under commercial insurance plans.”
The indices estimate the per capita change in revenues accrued each month by hospital and professional services facilities for services provided to Medicare patients and patients covered under commercial health insurance programs. The annual growth rates are determined by calculating a percentage change of the 12-month moving averages of the index levels compared with the same month of the prior year.