Private health insurance plans pay more

Workers who get health care coverage through their jobs are bearing the brunt of rising health care costs. And that’s mainly because health care prices keep going up, not because we’re using more health care services.

The big picture: Per-person spending is growing faster for private insurance than it is for Medicare or Medicaid, according to a new analysis from the Robert Wood Johnson Foundation and the Urban Institute.

• A separate analysis from the Health Care Cost Institute found that the per-person cost of employer-based insurance reached an all-time high in 2017, topping out at $5,641.

By the numbers: Costs are rising for people who get coverage through their employers, but those people aren’t using more health care services, according to HCCI, which collects its data directly from insurance claims.

• Total utilization was up just 0.5% from 2016 to 2017, and was slightly down over a 5-year period.
• In private insurance, the biggest spending growth over the past decade came from nursing and home health, followed by hospitals, according to the Commonwealth study.
• Prescription drugs were the biggest cost driver in Medicare. In Medicaid, it was administrative costs and doctors.

The bottom line: These 2 reports cement a lot of conventional wisdom about the health care system: Prices, not utilization, are driving up spending; and public programs control their costs more tightly than private plans, overall.

Go deeper: The trends shaping health care in 2019