Cities that spend most, least on health care

By Karen Schwartz Posted : 09/27/2011

Health insurance costsThere are big differences from city to city in the amount of money Americans with employer-sponsored health care plans spend on their medical needs, according to a study by Thomson Reuters.

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The recent study by the data-gathering company considered the use and cost of health care services for 23.5 million Americans in 382 metropolitan statistical areas (MSA) during 2009. It used Thomson Reuters’ repository of health care claims.

The metro area with the highest amount of spending was Anderson, Ind., at $7,231 per person. The MSA with the lowest amount of health care spending for the commercially insured, at $2,623 per person, was Ogden-Clearfield, Utah.

Below are the 10 highest- and lowest-spending regions in the U.S. for those with employer-sponsored health insurance.

Ten highest-spending metropolitan areas in 2009

1.    Anderson, Ind. $7,231

2.    Punta Gorda, Fla. $7,168

3.    Racine, Wis. $6,528

4.    Naples-Marcos Island, Fla. $6,312

5.    Ocean City, N.J. $6,128

6.    Barnstable Town, Mass. $6,123

7.    Flint, Mich. $6,061

8.    Lake Havasu City-Kingman, Ariz. $5,977

9.    Ocala, Fla. $5,976

10.  Carson City, Nev. $5,931

Ten lowest-spending metropolitan areas in 2009

1.    Ogden-Clearfield, Utah $2,623

2.    Dubuque, Iowa $2,719

3.    Fayetteville-Springdale-Rogers, Ark.-Mo. $2,762

4.    Fort Smith, Ark.-Okla. $2,916

5.    Laredo, Texas $2,919

6.    Amarillo, Texas $2,942

7.    McAllen-Edinburg-Mission, Texas $2,950

8.    Salt Lake City $2,979

9.    Fargo, N.D. $2,996

10.  Sioux City, Iowa $3,029

Reasons for variation unclear

According to Ray Fabius, chief medical officer for the health care business of Thomson Reuters and one of the study's authors, researchers now need to further examine the results of the study to determine reasons for the variation in spending patterns.

"We will probably find out that this variation cannot be solely explained by the illness or lack of illness in these communities," he says.

Fabius says researchers need to look at local practice patterns and the amount of competition among hospitals to deliver health care services.

"Generally, we know that the greater the competition in a community, the better the pricing is from a consumer standpoint," Fabius says. "If there is a single dominant hospital in a community, they would not have pricing pressure; if there are more hospitals in a community, there is more pricing pressure.”

Insurance companies, Fabius says, should not be surprised by the results of the study.

"Insurance companies that serve more than one geographic area know that there is a variation in health care spending from one area to another," he says.

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