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Medical costs increase, but number of patients treated and services rendered remained stable

Total medical expenditures increased markedly between 1996-1997 and 2011-2012, but the number of individuals with visits during an average month and the total utilization of medical services were largely unchanged, according to research recently published in Annals of Family Medicine.

Researchers noted that the majority of the cost increases were in specialty and hospital care and cost of medications, not primary care, which actually saw a decrease in utilization over the period studied.

“Previous studies have investigated how expenditures associated with medical care have changed over the past 50 years, and more recent studies have shown that in the 2000s, prescription drugs and hospital out-patient and physician care have led to a disproportionate amount of the increase,” Michael E. Johansen, MD, MS, Grant Family Medicine, Ohio Health, Columbus, wrote. “Research to date has not, however, synthesized previous ecology frameworks with the increasing expenditures of medical care.”

Johansen conducted a repeated cross-sectional study using nationally representative data mainly from the 1996, 1997, 2011 and 2012 Medical Expenditure Panel Surveys. These data were augmented with the 2002 and 2003 MEPS as well as the 1999-2000 and 2011-2012 National Health and Nutrition Examination Survey. Individuals, utilization and expenditures per 1,000 people during an average month in 1996-1997 and 2011-2012 were determined for more than a dozen services, including outpatient; inpatient; ED; physician; nurse and midlevel clinician such as nurse practitioner, physician assistant or nurse midwife; optometry/podiatry; alternative/complementary medicine; diagnostic testing/treatment when no clinician was seen during a visit or main reason for the visit was immunization or allergy shot; therapy; and prescribed medications.

Johansen found no significant difference over time in the individual or utilization frameworks for total visits, outpatient visits, physician visits, specialty physician visits, ED visits, nurse and midlevel clinician visits, or inpatient hospitalizations. However, expenditures increased in total, outpatient, outpatient physician, specialty physician, nurse and midlevel clinician and ED expenditure. Primary care physician visits decreased in the utilization framework but not in the individual or expenditure frameworks. There were increases in the expenditure-per-visit and expenditure-per-individual ratios in all categories, and the increases varied dramatically. In addition, the utilization-to-individual ratio decreased for outpatient physician visits and primary care physician visits, but increased for ED visits. Prescribed medication use was higher in 2011-2012 in the utilization and expenditure frameworks but not in the individual framework.

He also found that although the increase per individual or prescription was smaller than in other categories, 42.2% of the increase in expenditure was related to increases in prescription drug use; this expenditure was responsible for only 12.5% of total expenditures in 1996-1997. Therapy, treatment, optometry/podiatry, and alternative/complementary medicine visits increased in the individual, utilization and expenditure frameworks, and only treatment saw significant changes in the expenditure-to-individual ratios. Also, the expenditure-to-utilization ratio was higher for treatment visits and alternative/complementary medicine visits, and the utilization-to-individual ratio was lower for treatment visits and alternative/complementary medicine visits.

“Given that nearly all of the increases in expenditures were external to primary care, cost reduction emanating from primary care would likely require considerable alterations to aspects of the three frameworks along with influence and infrastructure that most primary care clinics do not currently possess. To more explicitly state this point, primary care could optimally reduce the stable ED utilization, specialized physician visits, and inpatient hospitalizations within the population that are associated with a primary care physician, but primary care has little control over either the increasing expenditures when an individual is in an alternative location or the largely stable individual and utilization frameworks that have persisted over the course of this study,” Johansen wrote. “The one area in which primary care could directly lower expenditures is prescribed medications, but the amount of this reduction is uncertain as the data do not allow for splitting these expenditures between specialty and primary care physicians.”

In a related editorial, Karen DeSalvo, MD, MPH, MSc, former Acting Assistant Secretary for Health, and Andrea Harris, MSc, wrote that although improvements in health care delivery system are being sought, multiple approaches will be needed.

“While the health system is working to achieve the triple aim by improving the health care delivery system, it alone will not be sufficient to bend the cost curve and reverse declining life expectancy and increasing disparities. This will be true even if we build better delivery models that address the social needs of patients,” DeSalvo and Harris wrote. “To improve overall population health, we will need to embrace disruptive models of health that address health care needs as well as the social factors and enable leaders to build healthier communities that support affordable, equitable health for all.” – by Janel Miller

Disclosure: The researchers report no relevant financial disclosures.