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The National Institute for Health Care Management (NIHCM) Foundation:
Rising Hospital Prices Are Driving Up Health Care Spending

18 February 2019

A new study found that hospital prices paid by private insurers for inpatient and outpatient care grew much more quickly than the prices paid to the physicians who provide care in these settings. For all inpatient care, hospital prices grew by 42 percent compared to 18 percent for physician prices. The same pattern was observed for four specific high-volume hospital-based procedures. This Research Insights summarizes the findings of this study, conducted by NIHCM grantee Zack Cooper and colleagues, and outlines proposed policy solutions.

Cooper Z, Craig S, Gaynor M, Harish NJ, Krumholz HM and Van Reenen J. "Hospital Prices Grew Substantially Faster Than Physician Prices for Hospital-Based Care in 2007-14." Health Affairs, 38(2):184-9, February 2019.

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Lord Prior also reiterated his view that competition in the NHS has proven "deeply damaging" and "failed almost totally". This may come as news to those familiar with the peer-reviewed academic work of Carol Propper, Zack Cooper and John Van Reenen. (The meaningful debate here is probably whether the effectiveness of competition is also cost-effective in both financial and opportunity cost terms.)

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