Recently, the Health Care Cost Institute (HCCI) published the Healthy Marketplace Index (HMI) – Price Index report, examining relative healthcare prices in 112 different metropolitan areas in 43 states across the country. This report is the first in a new series of releases from the HMI project, funded by the Robert Wood Johnson Foundation, which compares commercial healthcare markets across the country.

We found widespread price variation across metro areas. Interestingly, the types of services that drove price levels within metros varied widely as well. We also found evidence of substantial price growth across all geographies and services from 2012 to 2016.

The HMI project has three key goals. There is limited publicly available research with transparent and replicable methodologies using commercial healthcare data. The Healthy Marketplace attempts to fill this void by using claims data from three large national insurers to develop several economic measures related to the spending, prices, and utilization of the privately-insured population.

Another goal of the HMI project is to present the data in a digestible way, that allows a variety of audiences to understand and break down commercial healthcare metrics by geography (112 metros), measure (e.g., utilization), and category of service (inpatient, outpatient, and professional procedures). For instance, we hope that readers can use our first Price Index report to understand how their prices compare to other metro areas, the variation among prices by service category, and how prices have grown over time.

Finally, consistent with HCCI’s mission to expand data accessibility, the HMI project provides public use files for each measure and report we develop. By publishing the underlying index measures for every metro in every year, we aim to give local stakeholders, researchers, and consumers tools to explore their metro’s characteristics and trends in greater detail. While we attempt to give readers control over the data exploration experience in our interactive articles and web-based tools, publishing the underlying index measures for every metro in every year gives local stakeholders, researchers, and consumers tools to explore their metro’s characteristics and trends in greater detail.

The HMI project takes HCCI’s transparency efforts a step further by publishing comprehensive methodology documentation and supporting data. Our methods document details how we use our claims data to construct a fixed market basket of services (for each category of service) and how we compare that basket across metro areas and over time. We are also publishing the set of 1,100 distinct medical procedures included in our fixed service category market baskets, as well as every service’s spending weight – which are collectively used to compute the price index for each metro area. We hope that our HMI results and resources can augment local stakeholders’ deeper knowledge of their local market factors and support further analyses. For example, researchers using local healthcare claims data, such as a state All-Payer Claims Database (APCD), could use our supporting data and documentation to either replicate our findings or create completely comparable measures. Replicating and expanding upon the HMI with other datasets can be deeply beneficial to consumers and policymakers alike. In short, we hope the HMI work is a significant step forward toward a more complete picture of our diverse healthcare system.

The opinions expressed in this blog post are the authors’ own and do not necessarily reflect the view of AcademyHealth.

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Bill Johnson, Ph.D.

Senior Researcher - Health Care Cost Institute

As a senior researcher, Dr. Johnson oversees the Healthy Marketplace Index project and supports a variety of o... Read Bio

Kevin Kennedy headshot

Kevin Kennedy, BS

Researcher - Health Care Cost Institute

In his role as researcher, Mr. Kennedy performs data manipulation and statistical analysis on HCCI’s vast comm... Read Bio

Committee Member

Niall Brennan, M.P.P.

Senior Advisor for Data Strategy to the Director - Centers for Disease Control and Prevention

Niall Brennan is the Senior Advisor for Data Strategy to the CDC Director. Read Bio

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Sally Rodriguez, M.P.H.

Chief of Staff and Director of Products - Health Care Cost Institute

Sally Rodriguez serves as the Chief of Staff and Director of Products at the Health Care Cost Institute. Read Bio

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