Milliman Says Annual Medical Cost for
American Family of Four' is $12,214
Source: PRNewswire
PRESS RELEASE
Publication date: 2005-05-25
SEATTLE, May 25 /PRNewswire/ -- Milliman,
Inc., one of the premier global consulting
and actuarial firms, announced today that
average medical spending for the "typical
American family of four" reached $12,214
in 2005. The finding is contained in the
first annual Milliman Medical Index (MMI).
The MMI measures average yearly healthcare
costs when the family of four is covered
by an employer-sponsored
Preferred Provider
Organization (PPO). The new Milliman
study determined that the average annual
medical cost for a family of four
increased by 9.1% from 2004 to 2005. The
average annual rate of increase for the
four year period 2001-2005 was 9.8%.
"The Milliman Medical Index provides a
benchmark by annually assessing the
changes in those costs over the past 5
years," said study co-author William
Thompson, a Milliman principal and
consulting actuary. "Unlike most surveys
that focus exclusively on 'employer' cost
increases, the MMI analyzes what it really
costs the U.S. economy to deliver health
care, and how this burden is allocated
between employers and employees," Thompson
added.
"The MMI examines the key drivers and
the components of actual medical spending,
including physician charges, prescription
drugs and hospital charges," said Robert
Cosway, Milliman principal and consulting
actuary. "We break out and measure the
rate of consumer spending versus the rate
of total spending for health care in a
given year. Based on a typical PPO plan
design, Milliman estimates that the
typical American family of four would pay
$2,035 out of their own pocket through
member cost sharing in 2005," study
co-author Cosway added.
Medical costs for a family are
determined by the number, type and cost of
healthcare services that they utilize and
the amounts that the employee's health
plan pays medical providers for these
services. Utilization of medical services
for a particular family varies
significantly based on the family's ages,
geographic area, health status and other
factors. The MMI is based on Milliman's
analysis of historical claim data and
understanding of trends in provider
contracting. The complete Milliman Medical
Index is available at http://www.milliman.com/
, or by calling Jim Loughman, Director of
Media Relations and Public Affairs, at
203-698-0008. |