A new report from the Utah Foundation on healthcare costs in Utah finds that, while Utah’s per capita healthcare costs are lower than any other state, charges for medical services can vary dramatically from one provider to the next.
Those are among the findings published in the research report “Bills of Health: What’s Driving Medical Service Costs in Utah?” It’s the first report in a planned Utah Health Cost series from the foundation. It analyzes spending by considering Utah’s health-cost profile, existing provider prices and utilization of medical services.
Key findings of the report include:
• Utahns spend less per capita on healthcare than the people of any other state in the U.S.
• Utah joins other low-cost states in exhibiting low-cost indicators such as low Medicare and Medicaid enrollments, a low number of hospital beds and a high uninsured rate.
• Utah’s low spending is due in part to certain demographic characteristics and health behaviors.
• Utah has the shortest average length of hospital stay in the country.
• While overall healthcare spending is growing rapidly in Utah, much of this growth is attributable to population growth.
Two categories of care — hospital services and physician and clinical services — together account for nearly two-thirds of health expenditures.
• Hospital rates for the same service vary significantly — in some cases, by up to three times.
• Among the main drivers of provider cost increases are the high cost of new medical devices and pharmaceuticals, overtreatment, consolidation among healthcare providers and increasing administrative complexity.
Increases in the rates for health services, rather than increases in usage of services, are the main driver of per capita medical care cost inflation.
While an aging population is a cost driver, it may not be as significant a factor as some perceive.
Subsequent reports in the series will examine the costs associated with health insurance and Medicaid spending in Utah.
“The report contains good news and bad news for Utahns,” said Utah Foundation president Peter Reichard. “Like other Americans, Utahns have been spending an increasing proportion of their income on medical care. On the other hand, Utah is a young, healthy state and we have a cultural aversion to bad habits like smoking. Meanwhile, our hospitals are doing a good job of keeping inpatient stays short. These and other factors are keeping our per capita costs the lowest in the nation.”
Healthcare was the No. 1 issue identified by voters in Utah Foundation’s 2016 Priorities Project.
The new research brief is available on the Utah Foundation website, www.utahfoundation.org.