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Keith Hearle, MBA; Lane Koenig, PhD; Robin Rudowitz, MPA; Jonathan M. Siegel, MA; Allen Dobson, PhD; Silver Ho, MPP. American Journal of Managed Care 2003;9:SP25-SP33.
Focus: To identify and rank the drivers of costs for healthcare services delivered in outpatient settings.
Study Design: Multivariate regression of state-level annual outpatient expenditures using (1) data on operating costs for outpatient services from hospital cost reports for 1996-1999 and (2) outpatient claims data from a large, national, group health insurer (LHIP) for 1998-2000.
Results: From 1998 to 2000, the cost drivers for outpatient costs per capita for LHIP members are listed below.
- Provider market structure: 35 percent
- Treatment patterns and technology: 18 percent
- General price inflation: 18 percent
- Physician and specialist supply: 11 percent
- Demographics and general economic conditions: 7 percent
- Healthcare regulation: 4 percent
- Provider payment: 4 percent
- Provider operating costs: 3 percent
Each percentage indicates the fraction of total outpatient expenditure growth attributable to that cost driver if each of the cost drivers changed by one percent.
Full Study:
Study of Healthcare Outpatient Cost Drivers
(PDF format, 1.84MB)
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