Report: Health Care Costs for Parent-Insured Children Rising


A new Health Care Cost Institute (HCCI) report, Children’s Health Care Spending: 2010-2013, shows that spending on health care for children ages newborn to 18, which is covered by employer-sponsored insurance (ESI), increased an annual average of 5.7% each year between 2010 and 2013.

For the total population, ages newborn to 64, spending grew 3.9% through ESI. By 2013, per capita spending on children reached $2,574, which is an increase of $391 from 2010, according to the Health Care Cost Institute. The general population’s per capita spending on health care was $4,864 during that same year.

In spite of of the fact that there was a drop in the use of prescription drugs and emergency room visits in 2013, children’s spending rose in that year. The report says this demonstrates that rising health care prices were a significant influence on the spending increase. The overall increase in spending was also affected by growth in spending on children’s inpatient services.

The study showed that health care spending on children grew more vigorously than the spending on the overall population over a three-year period, in part because of a rise in hospital admissions for newborn babies, reports Dan Mangan of NBC News. The disparity identified by the report caused the researchers to ask whether the higher spending rate is, in fact, resulting in better health outcomes for young people and how much will insurance prices be affected if the upward spiral continues.

“We do know that spending is going up every year, we know that spending on kids is going up faster, and this is particularly true for babies,” said Amanda Frost, a senior researcher at HCCI, a nonprofit backed by large health insurers. “We don’t know what the impact of this spending is on the population’s health, or families or the health-care system.”

In 2013, approximately half of all children 18 years and younger were covered by job-based health plans. For boys newborn to 18, the per capita spending was $2,716. For girls in the same age range, it was $2,426. However, when the HCCI looked at teenagers, health spending was higher for girls than for boys of the same age group.

“The largest dollar increase in the average price per service was in inpatient admissions,” the report noted. In 2013 alone, “the average price per admit increased by $744,” hitting $14,685 per admission.

The biggest driver in the rise of admissions were newborn babies between 0 and 18 days old admitted separately from their mothers. Frost does not yet know why this is true, but higher average prices were seen for baby boy admissions than for baby girls. Overall, it was babies aged newborn to three-years-old who had the highest spending level of all age groups for juveniles.

Christopher Snowbeck, writing for Minnesota’s Star Tribune, reports that Stephen Parente, a health care finance expert at the University of Minnesota, says the results of the report fit with the trend of more kids being treated for diabetes, depression, and other health issues. The study looked at claims information for an average of approximately 10.2 million young people annually who have employer-sponsored insurance coverage.

“Many people often quickly jump to the conclusion that more spending — when we have such high spending — is a bad thing,” Frost said. “But I think that we really have to keep in mind that we’re talking about spending on actual children. If more spending means better health outcomes for these children, then I think it’s a very good thing,” she said. “But we’re not really in the business of making those judgments.”

The report found that labor and delivery admissions for teenage girls in 2013 fell from five to four admissions per 1,000 girls, but mental health and substance abuse admissions increased by one admission per 1,000 teen girls per year from 2010 to 2013 and reached 13 admissions in 2013, according to Shelby Livingston. reporting for Business Insurance.

Children ages four to eight were the lowest per child in 2013 at $1,703. This age group used fewer medical services than other children’s age groups.

07 25, 2015
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