Factors keeping healthcare costs steady
A variety of factors has helped keep healthcare costs steady, observers say.
“Growth in healthcare spending has remained relatively stable in the United States, Florida and South Florida,” said Karoline Mortensen, an associate professor at the University of Miami’s Department of Health Sector Management & Policy.
“Healthcare spending comprises the largest component of the state budget,” she explained. “The combination of effects from the Great Recession and the Affordable Care Act (ACA) has slowed growth in Medicare spending from the levels projected by the Congressional Budget Office.
“Florida’s move to mandatory managed care for Medicaid enrollees has resulted in modest growth and predictability in Medicaid spending, but the participating insurance companies have pressed for higher reimbursements,” Dr. Mortensen said. “More than 1.5 million people in Florida have purchased individual insurance coverage on the Healthcare Exchanges, the highest enrollment of any state. The premiums for these enrollees are subsidized for the vast majority of enrollees, and the premiums for this coverage decreased by double digits for the average ‘silver’ plan in Florida in 2016,” she said.
ACA plans are separated into four categories – bronze, silver, gold and platinum – based on the percentage the plan pays of the member’s average overall healthcare costs. The percentages the plans will spend are 60% (bronze), 70% (silver), 80% (gold) and 90% (platinum), according to the ACA website.
“We have seen statewide medical cost trends going up slightly this year, but they are still at low levels relative to the past five or 10 years,” said Toni Woods, spokesperson for Florida Blue.
“We do not necessarily see any significant variations on a regional basis relative to our overall trend.”
Controlling pharmacy costs is often cited as a key to keeping healthcare costs low. Some insurers have instituted a “step” regimen that requires patients to try a cost-effective “first choice” medication before a costlier “second choice” medication is approved for coverage.
“Florida Blue currently uses step therapy to allow patients to try equally effective and usually less expensive drugs before ‘stepping up’ to more expensive and potentially less efficacious drugs (sometimes name brands) that can cost individuals, employers and employees more money and impact the price of insurance and out-of-pocket costs,” Ms. Woods said. “Doctors always retain their ability to prescribe a different drug if they deem it a better treatment. Florida Blue seeks to provide the best care for patients at an affordable cost.”