Healthcare cost inflation is more than a percentage

An article today in Workforce Management explains the sometimes misleading nature of a reduced cost trend. On the one hand, the 7.4% cost increase in 2009 is the lowest in the history of the Milliman Medical Index, marking the third consecutive year of deceleration.

On the other hand, the increase of $1,162 is the highest since the high-water year of 2006, which saw a 9.6% increase that totaled $1,168.

Cost Trend

The difference?

The total dollar amount of healthcare for a typical family of four has risen so high in five years that any cost inflation, even decelerating inflation, becomes more expensive. So while the deceleration is a good thing, we still have a ways to go before families will notice the difference.