Midweek update

The actuarial consulting firm Milliman released its annual Milliman Medical Index report yesterday.

The annual Milliman Medical Index (MMI) measures the total cost of healthcare for a typical family of four covered by a preferred provider plan (PPO). The 2012 MMI cost is $20,728, an increase of $1,335, or 6.9% over 2011. The rate of increase is not as high as in the past, but the total dollar increase was still a record. This is the first year the average cost of healthcare for the typical American family of four has surpassed $20,000.

The employee's share including premiums and out of pocket costs is about 42% of the total cost.

Kaiser Health News reports about the activities of the State of Colorado, which is implementing an all payer claims database similar to what OPM is doing for the FEHBP. Colorado is one of 14 states that is using such a database to create an online application for  consumers.

[When the database is operational later this year, p]atients will be able to go online and see how much something is actually going to cost them, and compare prices across hospitals and doctors. They'll be able to see how much variation there is in terms of charges and costs. It will cover essentially all procedures, anything that is billed and being paid for by an insurance company. 

OPM has expressed a concern in recent benefit and rate proposal call letters about rising prescription drug costs in the FEHBP. The AMA News reports that the cost curve could be brought down and patient safety could be increased if doctors adopted more conservative prescription habits. An article in the June 13 Annals of Internal Medicine  "makes several recommendations on how physicians can revamp their prescribing habits, including considering other treatment options, being more strategic about the prescriptions they write, being educated about and aware of possible adverse effects, and being cautious of prescribing new drugs." Kudos to the authors.