New Health and Society Study Results from Congressional Budget Office Described (How Price and Quantity Factors Drive Spending In Nongroup and Employer Health Plans): Health and Medicine – Health and Society

2022 APR 19 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- Research findings on Health and Medicine - Health and Society are discussed in a new report. According to news originating from Washington, District of Columbia, by NewsRx correspondents, research stated, “To describe how spending in private, nongroup health insurance plans compared to spending in employer plans and to attribute those spending differences to components related to provider prices and quantity of care. The 2016 commercial claims and enrollment data of three large, national insurers from the Health Care Cost Institute.”

Our news journalists obtained a quote from the research from Congressional Budget Office, “We compared per member per month spending across three employer and three nongroup market segments, including on-exchange, off-exchange, and short-term plans, to average commercial spending. We constructed price indices in each market segment and then decomposed spending differences into those attributable to differences in prices, health risk, plan generosity, and other factors. Data Collection/Extraction Methods We selected all medical claims for enrollees in commercial plans. We excluded enrollees with Medicare Advantage coverage or those for whom the majority of claims were covered by a secondary payer. Provider prices were 4.1% lower in on-exchange plans (p < 0.001) and 1.4% lower in off-exchange plans (p < 0.001), compared to average prices in the same geographic area. In contrast, prices in employer plans were within roughly a percentage point of those averages. Differences in average spending were much larger than price differences. Off-exchange enrollees spent 20% less than the sample average (p < 0.001), whereas on-exchange enrollees spent 12% more (p < 0.001). Those differences were driven largely by variation in health risk, with variation in prices, plan generosity, and other factors contributing smaller amounts. Our results indicate that provider prices in nongroup plans are much closer to the prices paid by employer plans than to the substantially lower prices paid by public payers. In addition, health risk was the largest contributor to differences in spending.”

According to the news editors, the research concluded: “Lowering provider prices and attracting healthier enrollees in nongroup plans may be crucial for lowering premiums.”

This research has been peer-reviewed.

For more information on this research see: How Price and Quantity Factors Drive Spending In Nongroup and Employer Health Plans. Health Services Research, 2022. Health Services Research can be contacted at: Wiley, 111 River St, Hoboken 07030-5774, NJ, USA. (Wiley-Blackwell - http://www.wiley.com/; Health Services Research - http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1475-6773)

The news correspondents report that additional information may be obtained from Karen Stockley, Congressional Budget Office, Ford House Off Bldg, Second & D St SW, Washington, DC 20515, United States.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1111/1475-6773.13962. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

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