Alaska Health Care Spending Reaches $5.3B in 2005, Report Says

Health spending in Alaska in 2005 reached an estimated $5.3 billion, increasing up from $1.6 billion in 1991, according to a report "Alaska's $5 Billion Health Care Bill -- Who's Paying?" by University of Alaska-Anchorage researchers, the Anchorage Daily News reports. Spending on health care equaled one-sixth the value of the state's goods and services and rose faster than any of the lower 48 states, the report says. Technology is the biggest reason health care costs nationwide increased more than twice the rate of inflation, co-author Mark Foster of the University of Alaska Anchorage's Institute of Social and Economic Research said. The report finds that federal, state and local governments paid $2.2 billion or 42% of the costs, while employers paid $2 billion or 39%, and individuals paid $1 billion or about 20%. The report also finds that Medicaid spending more than quadrupled to about $1 billion in 2005. About half the workers for private companies obtained health coverage through their employer, according to the report. Foster said that increasing health costs make the state's labor force more expensive, which can put Alaska at a competitive business disadvantage. Some employers have lowered their health care costs by becoming self-insured and shifting more of the burden onto workers. Duane Heyman, executive director of the Alaska Health Care Roundtable, said the high costs of health care need to be addressed, adding that implementing electronic health records could significantly increase quality and lower costs. Despite the increasing health care costs in Alaska, residents generally are healthier, with drops in infant mortality, deaths from heart disease and smoking rates. However, the state's increasing obesity rate is a major concern, according to state public health section chief Tammy Green. Spending on health care could double again in the next seven years if current trends hold, according to the report (Schell, Anchorage Daily News, 3/10).

The report is available online. Note: You must have Adobe Acrobat to view the report.