1. 1 Section 1: Minnesota Health Care Spending and Cost Drivers Minnesota health care spending by source of funds Minnesota health care spending by type of service Minnesota/U.S. health care spending comparisons Minnesota private market trends: premiums, spending, and cost drivers

2. MINNESOTA HEALTH CARE SPENDING BY SOURCE OF FUNDS

3. 3 Minnesota Health Care Spending by Source of Funds, 2012 Total Spending $39.8 Billion *Other major private payers include, private worker’s compensation and auto medical insurance. **Major components of other public spending are MinnesotaCare, government workers’ compensation and Veterans Administration. Source: MDH Health Economics Program

4. 4 Minnesota Health Spending by Source of Funds, 2008 to 2012 Millions of Dollars 20082009201020112012 Public Spending, Total $14,901 $16,054$16,785$17,571$18,398 Medicare $6,165$6,564$6,887$7,158$7,626 Medicaid $6,543$7,006$7,322$8,047$8,374 Other Public Spending $2,193$2,484$2,575$2,366$2,398 Private Spending, Total $20,598 $20,909$20,769$20,729$21,425 Private Health Insurance $14,884$15,155$15,149$15,015$15,491 Out-of-Pocket $4,775$4,779$4,657$4,749$4,932 Other Private $939$975$963$966$1,002 Total $35,500 $36,963$37,554$38,301$39,823 Note: Detail may not sum to total due to rounding. Revisions to historic time series may lead to slight variation from previously published estimates. Source: MDH Health Economics Program

5. 5 Shares of Minnesota Health Spending by Source of Funds, 2008 to 2012 20082009201020112012 Public Spending42.0%43.4%44.7%45.9%46.2% Medicare 17.4%17.8%18.3%18.7%19.1% Medicaid 18.4%19.0%19.5%21.0% Other Public Spending 6.2%6.7%6.9%6.2%6.0% Private Spending58.0%56.6%55.3%54.1%53.8% Private Health Insurance 41.9%41.0%40.3%39.2%38.9% Out-of-Pocket 13.5%12.9%12.4% Other Private 2.6% 2.5% Total100.0% Note: Detail may not sum to 100% due to rounding. Revisions to historic time series may lead to slight variation from previously published estimates. Source: MDH Health Economics Program

6. 6 Public Spending for Health Care in Minnesota: Federal, State, and Local Shares, 2012 Total Public Spending $18.7 Billion Source: MDH Health Economics Program

7. 7 Public Programs’ Share of Population vs. Share of Health Care Spending, 2012 Source: MDH Health Economics Program

8. 8 Minnesota Health Care Spending per Person by Payment Source, 2012 *Excludes Medicare Supplement insurance. # Excludes portion of expenses paid by Medicare Advantage enrollee premiums MA is Medical Assistance, GAMC is General Assistance Medical Care, MCHA is Minnesota Comprehensive Health Association. Individuals with dual coverage are included in each of the respective coverage options. Source: MDH Health Economics Program

9. 9 Shares of Health Care Spending Paid for by Businesses, Government, and Individuals, 2012 Health care spending by local and state government employers included in the business spending for health care. Source: MDH Health Economics Program

10. MINNESOTA HEALTH CARE SPENDING BY TYPE OF SERVICE

11. 11 Minnesota Health Care Spending by Type of Service, 2012 Total Spending $39.8 Billion *Includes home health care Source: MDH Health Economics Program

12. 12 Minnesota Health Care Spending by Type of Service, 2008 to 2012 Spending in Millions of Dollars Type of Service 20082009201020112012 Inpatient Hospital$7,340$7,588$7,577$7,570$7,910 Outpatient Hospital$4,274$4,585$5,035$5,388$5,970 Physician Services$7,207$7,225$7,342$7,323$7,648 Long Term Care (incl. Home Care)$5,403$5,644$5,740$5,937$6,016 Prescription Drugs$3,469$3,687$3,451$3,280$3,423 Dental$1,385$1,290$1,246$1,263$1,290 Other Professional Services$1,151$1,218$1,105$1,245$1,359 Chemical/Mental Health$824$918$947$966$1,007 Other Medical Spending$2,720$2,901$3,084$3,263 Other non-Medical Spending$1,726$1,906$2,027$2,067$1,938 Total$35,500$36,963$37,554$38,301$39,823 Growth from previous year 4.8%4.1%1.6%2.0%4.0% Note: Revisions to historic time series may lead to slight variation from previously published estimates. Source: MDH Health Economics Program

13. 13 Shares of Minnesota Health Care Spending by Type of Service, 2008 to 2012 Type of Service 20082009201020112012 Inpatient Hospital20.7%20.5%20.2%19.8%19.9% Outpatient Hospital12.0%12.4%13.4%14.1%15.0% Physician Services20.3%19.5%19.6%19.1%19.2% Long Term Care (incl. Home Care)15.2%15.3% 15.5%15.1% Prescription Drugs9.8%10.0%9.2%8.6% Dental3.9%3.5%3.3% 3.2% Other Professional Services3.2%3.3%2.9%3.3%3.4% Chemical/Mental Health2.3%2.5% Other Medical Spending7.7%7.8%8.2%8.5%8.2% Other Non-Medical Spending4.9%5.2%5.4% 4.9% Total 100.0% Note: Revisions to historic time series may lead to slight variation from previously published estimates. Source: MDH Health Economics Program

14. 14 Factors Accounting for Health Care Spending Growth in Minnesota, 2002 to 2012 Note: Revisions to historic time series may lead to slight variation from previously published estimates. Source: MDH Health Economics Program

15. MINNESOTA/U.S. HEALTH CARE SPENDING COMPARISONS

16. 16 Minnesota and U.S. Health Care Spending: Where It Came From, 2012 Sources: MDH Health Economics Program and Centers for Medicare & Medicaid Services (estimated spending for health consumption expenditures).

17. 17 Minnesota and U.S. Health Care Spending: Where it Went, 2012 Note: Some spending included in hospital services in the national estimate is defined as long term care spending in the Minnesota estimates. Sources: MDH Health Economics Program and Centers for Medicare & Medicaid Services (estimated spending for health consumption expenditures).

18. 18 Health Care Spending Per Capita and as a Share of the Economy, Minnesota and U.S. 20082009201020112012 Per Capita Health Care Spending: Minnesota $6,713$6,973$7,071$7,163$7,403 U.S. $7,421$7,689$7,919$8,136$8,389 Health Care Spending as a Share of the Economy: Minnesota 13.5%14.3%14.0%13.7%13.5% U.S. 15.3%16.4% 16.3%16.2% Note: Revisions to historic time series may lead to slight variation from previously published estimates. Sources: MDH Health Economics Program, Centers for Medicare & Medicaid Services (spending for health consumption expenditures).

19. MINNESOTA PRIVATE MARKET TRENDS: PREMIUMS, SPENDING, AND COST DRIVERS

20. 20 Growth in Private Health Insurance Premiums and Health Care Spending Fully-insured market only. Source: MDH Health Economics Program.

21. 21 Difference Between Per Person Premiums and Spending as a Percent of Revenue Note: A positive number indicates that premiums were higher than spending, and a negative number indicates that spending was higher than premiums. Source: MDH Health Economics Program.

22. 22 Key Minnesota Health Care Cost and Economic Indicators, 2000 to 2010 Health care cost is MN privately insured spending on health care services per person, and does not include enrollee out of pocket spending for deductibles, copayments/coinsurance, and services not covered by insurance. Sources: Health care cost data from Minnesota Department of Health, Health Economics Program; per capita personal income from U.S. Department of Commerce, Bureau of Economic Analysis; inflation data from U.S. Bureau of Labor Statistics (consumer price index); workers’ wages from MN Department of Employment and Economic Development

23. 23 Total Cost Per Person and Health Plan & Enrollee Shares Source: MDH, Health Economics Program.

24. 24 Health Care Cost Drivers: Spending Growth and Shares of Total Growth by Service, 2008 to 2010 Growth RateShare of Spending Growth Note: Growth rates calculated as annual growth per enrollee over the 2-year period. “Other medical” includes skilled nursing facilities, home health care, emergency services, services of health professionals other than physicians and dentists, durable medical goods, and chemical dependency/mental health. Source: MDH Health Economics Program.

25. Additional Information from the Health Economics Program Available Online Health Economics Program Home Page www.health.state.mn.us/divs/hpsc/hep/index.html Publications http://www.health.state.mn.us/divs/hpsc/hep/publications/index.html Health Care Market Statistics (Presentation Slide Decks) www.health.state.mn.us/divs/hpsc/hep/chartbook/index.html Interactive Health Insurance Statistics https://pqc.health.state.mn.us/mnha/Welcome.action