Latest HCCI Report Shows Continued Increases for Those With Employer-Sponsored Health Insurance

Workers with health insurance through their jobs saw out-of-pocket costs rise 14.5%, or $114, between 2014 and 2018, and also increased the use of psychiatry services and substance use facilities.

With healthcare issues continuing as the top-ranked concern among voters this election year—a poll out Thursday named the issue ahead of immigration, national security, the economy, and jobs—an annual spending report shows an all-time high in healthcare spending for those who have health coverage through the workplace.

The Health Care Cost and Utilization Report found that average annual healthcare spending for those with employer-sponsored health insurance rose to an all-time high of $5892 in 2018. Between 2014 and 2018, per-person spending grew at an average annual rate of 4.3%, consistent with National Health Expenditure data from CMS. Over the same period, per-capita gross domestic product increased at an average rate of 3.4%. Total spending per person grew 18.4%.

The report, from the Health Care Cost Institute (HCCI), analyzes 2.5 billion medical claims to look for trends. Among those trends: There was increased use of psychiatry services between 2014 and 2018, with what the authors called “strikingly high spending growth of 43%” during those years.

In addition, out-of-pocket (OOP) costs rose for substance use admissions and visiting the emergency department (ED). Substance use admissions carried higher OOP prices compared with the other subcategories of inpatient admissions and saw larger growth—an average increase of $366 per admission.

Average OOP spending increased to $907 per person. “People with job-based insurance saw their out-of-pocket costs rise 14.5%, or $114, between 2014 and 2018,” said John Hargraves, senior researcher and co-author of the report, in a statement. That number does not include heath insurance premiums.

Average prices grew 2.6% in 2018. While that is the lowest rate of growth over 5 years, steady year-over-year increases mean that prices were 15.0% higher in 2018 than 2014.

Utilization grew 1.8% from 2017 to 2018, the fastest pace observed during the 5-year period. Taking into account the higher price levels, the effect of the increase in utilization in 2018 on total spending was higher than it would have been in 2014.

Increased use of medical services was concentrated in 2018 and accounted for 21% of the growth after inflation—an average of $130 per person.

After adjusting for inflation, prices accounted for 75% of spending growth between 2014 and 2018, contributing $453 to spending per person over the 5-year period.

Of the 4 major categories covered by the report (inpatient services, outpatient services, professional services, and prescription drugs), visits and procedures saw the highest 2018 spending increase (5.5%).

For professional services, spending increased 16% and growth accelerated over the 5-year period, driven by office visits and administered drugs.

For outpatient services, increases in prices and use led to a 16% increase in spending from 2014 to 2018. ED visit spending increased 32% and spending on observation stays went up 29%.

Of the $5892 in spending per person, prescription drug costs made up the smallest portion—about 19%, or $1118.

This year’s report is the last to include feature data from UnitedHealthcare, which decided to stop sharing data with HCCI. Continued paper partners include Aetna, Kaiser Permanente, and Humana. In addition, HCCI will begin using data from Blue Health Intelligence, which represents medical claims from participating Blue Cross and Blue Shield company members.

About half of Americans get their healthcare coverage through work.

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