Rising Costs

The Latest Leading Cost Drivers in the Blue System

BHI Thought Leadership

At a macro level, total commercial health plan PMPM costs rose 6.5% from $413 in 2016 to $440 in 2018.

BHI’s analysis of notable trends revealed that sepsis remains on a worrisome trajectory. Specifically, admissions related to septicemia or severe sepsis with major complications (DRG 0871) is the third largest PMPM national increase. The PMPM is up 11.2% primarily due to an 8% increase in utilization compared to 2017.

Other notable findings from BHI’s surveillance of national healthcare trends and opportunities reveals that:

  • Specialty drug nivolumab (OPDIVO®), approved last year for first-line treatment of intermediate- and poor-risk advanced renal cell carcinoma, hit the top 10 most expensive drug list. The PMPM is up 44.8% from the prior year, with the average cost per service driving that increase.
  • High-cost claimants (those with over $100,000 in annual total healthcare costs) are up 12% from the prior year. The use of specialty drugs is the major contributor to their overall costs.
  • Treatment episodes related to multiple sclerosis are up 41.8% from 2017 and have become the seventh fastest-growing episodic cost contributor.

When Blue Plans leverage the power of national and regional medical economic benchmarks, they can quickly isolate improvement opportunities. Blue Cross and Blue Shield of Nebraska recently used BHI’s Trend Insyght solution to see how its costs differed from relevant regional norms. The plan narrowed in on a dozen cost-improvement opportunities and in one year, realized a 2.4% reduction in total medical costs.