New York State Healthcare Spending Rising Faster Than National Average

New York State Healthcare Spending Rising Faster Than National Average

Healthcare spending for New York State residents with employer-sponsored health insurance is both higher and rising faster than the national average, a report from the New York State Health Foundation and Health Care Cost Institute finds.

The report, Health Care Spending, Prices, Utilization for Employer-Sponsored Insurance in New York (34 pages, PDF), found that between 2013 and 2017 total per-person healthcare spending in the state increased 27 percent, to $6,335, the eighth highest in the country, while the national average rose 17 percent, to $5,641. Over the five-year period, spending in all categories — professional (doctor's visits), inpatient, and outpatient services, as well as prescription drugs — grew faster in New York State relative to the rest of the country, with professional services and prescription drugs accounting for about 40 percent and 20 percent of total per-person spending, both higher than the national average, while the share of spending on outpatient services was lower.

Nationally, the increase was driven almost entirely by a 17 percent rise in prices, the study found, while in New York State a 22 percent rise in prices was accompanied by a 5 percent increase in utilization. Indeed, prices rose faster in New York State for all services except professional, with prices of inpatient services increasing 32 percent, double the national average of 16 percent, and the point-of-sale price of several categories of drugs up more than 50 percent.

"These findings reinforce the need for more price transparency in health care: accurate, easy-to-understand, meaningful information about what consumers can expect to pay for their care," the report's authors write. "This type of transparency is a gateway to improving affordability, quality, and competition in the healthcare system and making the system work better for all Americans."

"Spending is both high and growing fast in New York State," said HCCI president and CEO Niall Brennan. "These findings point to certain services with particularly high relative price growth, such as hospital and prescription drug spending, as areas to explore for potential cost control efforts in New York."