Healthcare services covered by commercial insurance and Medicare programs continued to climb for the fourth month in a row, culminating in a 5.73 percent increase over the 12 months ending August 2011, according to the S&P Healthcare Economic Indices.
The increase was marginal, given the +5.69 percent annual growth rate posted in July 2011, but it was the fourth consecutive increase since the index hit its lowest annual growth rate of +5.32 percent in April 2011, according to the S&P data.
While commercial healthcare costs increased by 7.89 percent over the year ending August 2011, reflecting consistent increases for four consecutive months, Medicare claim costs hit a new low, rising at an annual rate of 2.16 percent, as measured by the S&P Healthcare Economic Medicare Index. Given its highest annual growth rate of +8.02 percent in November 2009, costs for this segment have decelerated by nearly three-fourths since then, or by about 5.86 percentage points.
The Hospital and Professional Services Indices posted increases of 5.43 percent and 5.84 percent, respectively, from their August 2010 levels. These reflected minor changes from the +5.31 percent and 5.89 percent respective annual rates posted in July 2011.
According to S&P officials, these indices represent total costs, not just prices, so that increased costs could be due to prices going up, increased utilization, or some combination of the two.
The S&P Healthcare Economic Indices estimate the per capita changes in costs for Medicare and commercial health insurance programs accrued each month by hospital and professional services facilities. The annual growth rates are determined by calculating a percent change of the 12-month moving averages of the monthly index levels versus the same month of the prior year.
Source: S&P Indices, October 20, 2011
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