Cost of Quality Reporting: $15.4 billion

Medicare aims to move away from fee-for-service reimbursement and towards value-based payment mechanisms based on quality of care.  Although the goal is laudable, there are a number of practical challenges.  First, most care is still provided via fee for service.  In 2013, 95% of all physician office visits were reimbursed using fee-for-service.  Second, collecting quality of…

What is they key driver of cancer care spending?

High-cost cancer drugs often get bad press. Cancer treatment certainly is expensive. However, drug costs are not the primary driver of high cost of cancer treatment; hospitalizations are. Using data from SEER-Medicare, Brooks et al. (2014) examine regional variation in the cost of cancer care and find: Acute hospital care was the largest component of…

Healthcare Costs to Rise by over 7 percent in 2013

Reuters reports on a PwC study evaluating health care premium growth. “The cost of healthcare services is expected to rise 7.5 percent in 2013, more than three times the projected rates for inflation and economic growth, according to an industry research report released on Thursday. But premiums for large employer-sponsored health plans could increase by…

Why is healthcare so expensive?

Why is medical care so expensive? It depends on who you ask. Victor Fuchs (1996) polled 46 health economists, 44 economic theorists and 42 practicing physicians. Fuchs asked if they agreed with the following statement: “The primary reason for the increase in the health sector’s share of GDP over the past 30 years is technological…