According to the Center for Studying Health System Change, the cost of health care rose 7.2% last year, with the cost of hospital care accounting for nearly half the increase.
Spending on outpatient care increased by 11.2% from 1999 to 2000, more than a third of the increase, according to the report – up from the 8.9% growth in the prior year.
Spending on inpatient hospital care rose by 2.8%, a sharp departure from the mid-1990s when inpatient costs were falling.
Spending for drugs also rose ? up 14.5% in 2000 after an 18.4% spike in 1999. Drug costs accounted for about a quarter of the overall cost increase, but that was less than the 41% they constituted in 1999.
The authors of the report suggested two primary causes for the decline in drug costs as a percentage of total costs:
- no new “blockbuster” drugs that drive up demand
- an increased use of tiered pharmacy plans, where patients pay extra to get name-brand drugs
The report’s authors said that insurance companies are anticipating continued cost increases ? and are trying to make up for profits lost in the late 1990s as they cut costs to gain business.
You can check out more of the report, Tracking Health Care Costs, at http://www.hschange.org/CONTENT/372/ .