As Health Cost Increases Moderate, Consumers Will Pay More: Will They Seek Less Expensive Care?

While there is big uncertainty about how health reform will roll out in 2014, and who will opt into the new (and improved?) system, health cost growth will slow to 6.5% signalling a trend of moderating medical costs in America. Even though more newly-insured people may seek care in 2014, the costs per “unit” (visit, pill, therapy encounter) should stay fairly level – at some of the lowest levels since the U.S. started to gauge national health spending in 1960.

That’s due to “the imperative to do more with less has paved the way for a true transformation of the health ecosystem, from fee-for-service medicine to consumer-centered care that rewards quality outcomes,” PwC asserts in Medical Cost Trend: Behind the Numbers 2014, published June 18, 2013.

What’s led to the health cost slowdown is a combination of four factors, PwC says:

1. Health care moving from higher cost inpatient hospital settings to lower cost retail clinics and mobile health. See the chart for the average cost differential between, say, and ER visit versus a retail clinic visit: $499 compared to $76.