NEW YORK, Oct. 18, 2012 /PRNewswire/ -- Data released today by S&P Dow Jones Indices for the S&P Healthcare Economic Composite Index indicates that the average per capita cost of healthcare services covered by commercial insurance and Medicare programs increased by 5.70% over the 12-months ending August 2012. This is a deceleration from the +6.15% annual growth rate recorded in July 2012.

As measured by the S&P Healthcare Economic Commercial Index, healthcare costs covered by commercial insurance plans increased by 7.81% over the year ending August 2012, down from the +8.36% reported for July 2012. Annual growth rates in Medicare claim costs rose by 2.48%, according to the S&P Healthcare Economic Medicare Index, down from the +2.79% recorded in July 2012.  The Professional Services Index annual growth rate was +6.67% in August 2012, down from the +6.95% July 2012 print. The Hospital Index's growth rate fell to +4.54% in August from +5.11% recorded in July 2012.

In August 2012, the Professional Services Medicare Index was up 2.36%, decelerating from its July's level of 2.98%. The Hospital Medicare annual growth rate in August was +2.35%, compared to its +2.44% rate in July. The Professional Services Commercial Index decelerated to +8.90% in August, from its recent high of +9.00% reported in July. The Hospital Commercial Index's annual growth rate decelerated to +6.23% in August from the +7.21% posted for July.

"All nine healthcare indices we publish decelerated in August 2012; and the deceleration is pretty substantial compared to recent historic patterns," says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. "In August, the Composite Index posted an annual rate of +5.70%, the Commercial Index +7.81% and the Medicare Index +2.48%. These rates were below their respective July 2012 rates.

"August data show that the growth rate in the Hospital Index has decelerated for four consecutive months, from a recent high of 5.75% in April 2012 to 4.54% in August. This downward looking trend was driven by a deceleration in hospital commercial plans, which were also down four consecutive months and saw the largest deceleration in August. The +6.23% rate is 0.98 percentage points below the 7.21% July rate and 2.5 percentage points below the 8.73% April rate.

"The Professional Services Commercial Index saw a slight deceleration from its recent July peak.  In August it was +8.90%, 0.10 percentage points below July's 9.00%, which was the highest rate since July 2008. It remains the highest among our indices.  In the past 12 months it has accelerated by 4.03 percentage points from its +4.87% August 2011 rate.

"The Professional Services Medicare Index posted a two-year low of +2.36%, 0.62 percentage points below last month's annual growth rate. The Hospital Medicare was up 2.35%, 0.09 percentage points below its July rate. The Hospital Medicare annual growth rate remains the lowest rate we publish for Healthcare Indices."

The S&P Healthcare Economic Indices estimate the per capita change in revenues accrued each month by hospital and professional services facilities for services provided to patients covered under traditional Medicare and commercial health insurance programs in the U.S. The annual growth rates are determined by calculating a percent change of the 12-month moving averages of the monthly index levels versus the same month of the prior year.

The S&P Healthcare Economic Composite Index is a weighted average of the S&P Healthcare Economic Commercial Index and the S&P Healthcare Economic Medicare Index.  Alternatively, it is a weighted average of the S&P Healthcare Economic Hospital Index and the S&P Healthcare Economic Professional Services Index, as each of these indices has the analogous Commercial and Medicare component.

The table below summarizes the year-over-year change in the S&P Healthcare Economic Indices for the 12-month period ending August 2012. With each monthly release, the index levels, including the 12-month moving averages, are recalculated for the full history of the indices, whenever there are revisions to underlying data used in the models. The entire revised history, as well as full results for the underlying S&P Healthcare Economic Indices, is available from S&P Dow Jones Indices as a subscription service.  

The S&P Healthcare Economic Indices were developed in consultation with Health Index Advisors, a joint venture between Aon Hewitt and Milliman, Inc., and were derived from the former Milliman, Inc. Health Cost Index™ which was first published in 1987. The complete methodology, fact sheet and supporting research for the S&P Healthcare Economic Indices are available at http://www.spindices.com/index-family/specialty/healthcare-cost

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For more information:

Dave Guarino
Communications
S&P Dow Jones Indices
dave_guarino@spdji.com
212-438-1471

David Blitzer
Managing Director and Chairman of the Index Committee
S&P Dow Jones Indices
david_blitzer@spdji.com
212-438-3907

SOURCE S&P Dow Jones Indices