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Healthcare Cost and Utilization Project (HCUP). HCUP Facts and Figures, 2006: Statistics on Hospital-Based Care in the United States [Internet]. Rockville (MD): Agency for Healthcare Research and Quality (US); 2008.

Cover of HCUP Facts and Figures, 2006: Statistics on Hospital-Based Care in the United States

HCUP Facts and Figures, 2006: Statistics on Hospital-Based Care in the United States [Internet].

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4SPENDING FOR INPATIENT HOSPITAL STAYS

EXHIBIT 4.1. Costs for the Most Frequent Principal Diagnoses

Top 20 Inpatient Hospital Principal Diagnoses with the Highest Aggregate Costs, 1997, 2003*, and 2006

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PRINCIPAL CCS DIAGNOSISTOTAL INFLATION-ADJUSTED HOSPITAL COSTS IN BILLIONS: 2006 DOLLARSPERCENT OF TOTAL COSTSAVERAGE ANNUAL PERCENT GROWTH
1997200320061997200320061997–20032003–20061997–2006
All diagnoses$216.3$305.1$329.2100% 100%100%5.9%2.6%4.8%
 Coronary atherosclerosis (coronary artery disease)14.517.117.57652.90.72.1
 Acute myocardial infarction (heart attack)9.012.311.84445.3−1.43.0
 Congestive heart failure6.610.711.23438.51.56.1
 Liveborn (newborn infant)7.810.010.84334.22.43.6
 Osteoarthritis (degenerative joint disease)4.67.710.32338.810.39.3
 Septicemia (blood infection)4.05.410.22235.123.610.9
 Pneumonia8.810.99.94433.6−3.01.3
 Complication of medical device, implant or graft5.59.09.43338.61.66.2
 Adult respiratory failure, insufficiency, or arrest3.35.08.12227.317.610.7
 Disorders of intervertebral discs and bones in spinal column (back problems)3.46.77.622212.14.39.4
 Cardiac dysrhythmias (irregular heart beat)3.56.56.822211.01.37.7
 Acute cerebrovascular disease (stroke)5.36.66.72223.60.62.6
 Complications of surgical procedures or medical care2.94.85.11229.02.16.6
 Rehabilitation care, fitting of prostheses, and adjustment of devices3.74.65.02223.72.73.4
 Diabetes mellitus with complications2.74.04.51116.93.45.7
 Biliary tract disease (gall bladder disease)3.34.34.42114.61.03.4
 Chronic obstructive lung disease3.34.34.22114.7−0.92.8
 Fracture of neck of femur (hip fracture)3.13.84.11113.22.52.9
 Non-specific chest pain1.63.73.911114.41.610.0
 Skin and subcutaneous tissue infections1.52.73.51119.98.99.6
Total for top 20 conditions98.4140.2155.04646476.13.45.2
Total for top 6 cardiovascular conditions40.557.057.91919185.80.54.0
*

Rather than showing costs for 2005, this table includes data for 2003, the year when growth in costs for cardiac conditions began to slow. Specific cost growth information on cardiac conditions is highlighted in Exhibit 4.2.

Adjusted for inflation using the G DP deflator (http://www​.bea.gov/national​/nipaweb/SelectTable.asp#S1, Table 1.1.4. Price Indexes for Gross Domestic Product).

The top 20 principal diagnoses with the highest aggregate inpatient hospital costs represented 47 percent of the $329.2 billion total cost for all stays in U.S. community hospitals in 2006. The top 20 diagnoses made up a similar share of costs (46 percent) in 1997 and 2003.

The most costly diagnoses:

  • The three most costly conditions treated in U.S. hospitals in 2006 were coronary artery disease, heart attack, and congestive heart failure—all conditions of the cardiovascular system. In fact, six of the twenty most costly conditions in 2006 were related to the cardiovascular system; costs for these conditions amounted to $57.9 billion in 2006, or 18 percent of all costs for hospitalization.
  • The three most costly inpatient diagnoses unrelated to heart disease were newborn infant (because of the number of discharges), blood infection (septicemia), and degenerative joint disease (because of the cost of hip, knee, and other joint arthroplasty). Arthroplasty was the principal procedure performed on 96 percent of the discharges with a principal diagnosis of degenerative joint disease, or osteoarthritis.
  • At least two of the top 20 most costly inpatient conditions were related to complications of medical care—complication of medical device, implant, or graft and complications of surgical procedures or medical care. Two other top 20 conditions also may include cases that experience a complication of treatment—blood infections (septicemia) and skin and subcutaneous tissue infections.

Cost increases:

  • Overall, the inflation-adjusted cost of hospitalization in the U.S. grew from $216.3 billion in 1997 to $329.2 billion in 2006, an increase of 52 percent. However, the cost grew more slowly in recent years. Between 2003 and 2006, costs increased 2.6 percent annually compared to a 5.9 percent annual increase between 1997 and 2003.
  • Of the top 20 costliest inpatient diagnoses, blood infections (septicemia) showed the most dramatic increase in inflation-adjusted costs from 2003 to 2006, growing by 23.6 percent annually, compared to annual growth of only 5.1 percent from 1997 to 2003.
  • The cost of hospitalizations for adult respiratory failure or arrest increased by 17.6 percent annually between 2003 and 2006, compared to only 7.3 percent from 1997 to 2003.
  • While costs attributable to complications of medical devices, implants or grafts and complications of surgical procedures or medical care still accounted for 4 percent of total hospitalization costs, these costs grew more slowly in recent years. The slowdown in cost growth came predominantly from less rapid increases in cost per discharge (up 0.3 percent annually between 2003 and 2006, compared to 4.8 percent from 1997 to 2003) and, to a lesser extent, from slower growth in the number of discharges with these diagnoses (up 1.5 percent annually between 2003 and 2006, compared to 3.7 percent between 1997 and 2003).
  • The cost of hospitalizations for skin and subcutaneous tissue infections grew at a consistently rapid pace throughout the period, more than doubling between 1997 and 2006.

Cost stabilization and decreases:

  • The cost of hospitalizations for pneumonia decreased by 3.0 percent annually from 2003 to 2006, reversing the trend over the previous six years where the cost increased by 3.6 percent annually.
  • For stays with a principal diagnosis of heart attack (acute myocardial infarction) and chronic obstructive lung disease, costs changed very little between 2003 and 2006.

EXHIBIT 4.2. Costs for the Most Frequent Principal Diagnoses by Body System

Distribution of Costs by Major Reason* for Hospital Stay, 2006.

Distribution of Costs by Major Reason* for Hospital Stay, 2006

* Based on MDC principal diagnosis.

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  • The top six conditions by body system were responsible for 67 percent of the total costs for all hospital stays.
    • In 2006, circulatory conditions accounted for the largest portion (23 percent) of hospitalization costs, or $79.5 billion, although they comprised only 16 percent of all stays.
    • Other conditions responsible for large portions of hospital costs included musculoskeletal system and connective tissue conditions (12 percent), respiratory conditions (11 percent), digestive conditions (9 percent), nervous system conditions (7 percent), and pregnancy and childbirth (5 percent).
Average Annual Growth in Total Inflation-adjusted Costs for the Most Expensive Circulatory Conditions,* 1997–2006.

Average Annual Growth in Total Inflation-adjusted Costs for the Most Expensive Circulatory Conditions,* 1997–2006

* Based on CCS principal diagnosis.

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  • The cost for hospitalizations related to circulatory conditions were large in 2006, with three-quarters of these costs concentrated in six specific circulatory conditions. However, the inflation-adjusted cost growth for stays with these six conditions slowed considerably in recent years.
    • The slowdown in inflation-adjusted cost growth was attributable in part to an actual decrease in the number of discharges with these six circulatory conditions—a decline of almost 1 percent per year from 2003 to 2006 compared to a 1.3 percent average annual increase from 1997 to 2003.
    • Slower increases in the inflation-adjusted cost per discharge contributed as well, with costs rising 1.4 percent per year between 2003 and 2006 compared to 4.5 percent per year between 1997 and 2003.

EXHIBIT 4.3. Average Length of Stay and Average Charges

In general, longer lengths of stay are associated with higher average charges. While charges are generally more than the amount paid by payers for the hospitalization because of negotiated discounts, they can be used as a benchmark for comparing the costliness of different types of hospital stays.

  • Overall, the average length of stay for any condition was 4.6 days, and the average charge was about $24,000 in 2006.
  • The two conditions with the longest hospital stays for all patients regardless of age were related to infants—infant respiratory distress syndrome and premature birth and low birth weight.
    • Infant respiratory distress syndrome and premature birth and low birth weight were also some of the most expensive conditions, with charges ranked second and fourth, respectively.
    • Premature birth and low birth weight had an average length of stay of 26 days and infant respiratory distress syndrome of 23 days. The next longest length of stay was tuberculosis with 15 days.
  • Conditions treated with expensive technology or requiring intensive care—including spinal cord injuries, heart valve disorders, and leukemias—had mean charges higher than expected based on their average length of stay (represented by the solid line in the graph).
  • Spinal cord injuries had the highest mean charge of any condition, $113,200, but had a lower average length of stay (14 days) than infant respiratory distress syndrome (23 days) which had a mean charge of $106,500.
  • Even though long lengths of stay can be costly, some conditions with the long lengths of stay had average charges that were lower than the expected average (represented by the solid line) in 2006. Typically, these conditions do not require expensive procedures as part of the hospitalization. Examples include schizophrenia and related disorders, affective disorders, and rehabilitation care.
Inpatient Hospital Stays for Principal Diagnosis*: Average Length of Stay and Average Charges, 2006.

Inpatient Hospital Stays for Principal Diagnosis*: Average Length of Stay and Average Charges, 2006

* Based on CCS principal diagnosis.

Download this figure as an MS Excel spreadsheet (60K)

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