PwC's Health Research Institute has released its annual medical cost trend report for 2015, which is based on interviews with industry executives, health policy experts and health plan actuaries, whose companies cover a total of 93 million members.
The HRI also analyzed results from PwC's 2014 Touchstone Survey of more than 1,000 employers across 35 industries. Here are five things to know from the report.
1. PwC projects a medical cost trend of 6.8 percent in 2015, up slightly from 6.5 percent for 2014. The medical cost trend is the projected percentage increase in per capita costs of medical services that affect commercial insurers and large, self-insured businesses.
2. The higher spending growth rate reflects a stronger economy and the millions of Americans who have gained health insurance coverage under the Patient Protection and Affordable Care Act, according to PwC.
3. Expensive specialty drugs will also drive spending, according to the report. Although only about 4 percent of patients use high-priced specialty drugs, they account for 25 percent of total U.S. drug spending. The report states that, in 2013, "70 percent of the 27 drugs approved by the FDA were specialty medications, raising the specter of a series of expensive treatment decisions in future years." Nine of those specialty medications were for cancer treatment. Overall, specialty drug spending is projected to reach $192.2 billion by 2016, a 121 percent increase from $87.1 billion in 2012.
4. However, the net medical cost growth rate in 2015 — taking into account benefit design changes that will likely slow spending growth by shifting costs to consumers — is projected to be 4.8 percent.
5. The rise of high-deductible health plans in particular will continue to contain utilization and spending. PwC's 2014 Touchstone Survey found 44 percent of employers across all industries were considering high-deductible plans as the only insurance option for their employees during the next three years. "Now more than ever, consumers are experiencing increased financial responsibility and are evaluating and rethinking how and when to spend," the report states.
For more information, read the full report here.
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