Report: Cost Of Health Care On Rise in N.H.

Insurance Department Says Residents Pay More for Services

Concord — Health care costs in New Hampshire continue to rise, and individuals are paying a larger share of those costs, according to a new report from the state Insurance Department out yesterday.

The report is based on 2012 numbers, but both of those trends — and a third: people are using less health care — will likely continue when numbers from this year and possibly even next are eventually reviewed, industry experts said.

“People are changing the way they access health care services,” said Tyler Brannen, an Insurance Department analyst.

As insurers and employers shift more of the burden of health care costs to individuals and provide incentives for people to use less expensive providers, consumers become more frugal, he said.

Health care prices in 2014 are set to increase about 8.1 percent, less than the 8.7 percent increase from 2013, according to the report.

But while premiums increased only about 1 percent in 2012, down from a 3.8 percent increase in 2011, consumers paid more out of pocket than in the previous year: more than 20 percent of total claims in 2012, up from 18 percent in 2011.

Insurers have also shifted more people onto plans with site-of-service benefit packages or tiered networks, which saved money, according to the report.

“I think all of those will continue to increase in 2013, and I think it’s going to further encourage a more efficient use of services (and) 2014 is actually going, in most respects, to maintain the current course we’ve seen,” despite the changes pending from the Affordable Care Act, he said.

“What’s changing is the way people are accessing services, and that’s going to continue the long-term trend on costs,” he said.

Those trends contributed to the insurers’ increased profit margins, according to the report.

On average, the companies’ profit margins increased from 3.1 percent to 3.4 percent.

The Insurance Department has been issuing these reports annually since 2010, and “to some extent we’ve got a good handle now on what’s happening with costs,” said Steve Norton, executive director of the New Hampshire Center for Public Policy Studies.

“We don’t have a good handle of the value of that care from the health perspective. ... In the 1980s, we spent 10 percent of gross state product on health care. It’s almost 20 percent now. What have we gotten in return from that?”

Some of the larger changes in the market in years to come will center around providers grouping together as accountable care organizations, which have been shown to improve health outcomes.

Their impact on costs isn’t as clear and may not be clear for some time, not even by this time next year, when the report of 2013 spending is released, Brannen said.