Researchers: area health care costs rise sharply

Researchers at Grand Valley said health care costs in West Michigan have increased faster than other cities and may be eroding the competitive advantage the area once held for companies searching for low health care costs.

Economics professors Sonia Dalmia and Paul Isely released the 2015 Health Check Forecast January 9. The annual report identifies health-related trends and issues facing Kent, Ottawa, Muskegon and Allegan counties.

Isely said hospital expenses in Grand Rapids have increase 108 percent over a 10-year period, 78 percent faster than comparison cities. He added the increase does not appear closely linked to length of stay, rate of hospital admissions, or changes in the demographics.

Isely, Dalmia and Seidman College of Business colleagues Kevin Callison and Leslie Muller used survey results and insurance data to analyze health care trends, health profession job outlook and demand, medical patents and medical costs for the four-county area.

Researchers also found that 17 percent of area residents are in poor or fair health. Other results are below:
• 20 percent of area residents smoke
• 19 percent binge drink
• 33 percent are obese
• 30 percent report no routine health exam within the last year.

These lifestyle choices correlate with increases in health care costs, researchers said. They recommend decreasing costs with routine testing. For example, if all West Michigan residents who have diabetes received routine testing, it could potentially save the area $32 million in medical costs.

The Health Check Forecast 2015 includes results of a survey about the impact of the Affordable Care Act on physician practices and a section about women’s health.

• Affordable Care Act: Researchers found the ACA rollout and Medicaid expansion have not greatly changed physician practices except for reports of increased patient volumes, more administrative work, and difficulty finding referring physicians.

• Women’s Health: Because women are typically the primary caregivers for children and elderly parents, the cost of treating women’s health issues magnifies. Researchers found if maternal health is improved and the number of low birth weight babies reduced by 20 percent, West Michigan would save $13.4 million annually.

Jean Nagelkerk, vice provost for Health, said the report reveals possible challenges as the number of area residents over age 65 increases and a decrease in the number of residents ages 20-34 continues. “If this trend continues,” Nagelkerk said, “our community is likely to face an increasing number of chronic health problems, an increase in health care utilization and a limited labor pool.”

The full report is available online at www.gvsu.edu/vphealth. It was made possible by a grant from Blue Cross Blue Shield of Michigan, Blue Care Network, and Priority Health.

On January 16 Isely will reveal his benchmark survey of the regional economy at the 2015 Collier’s West Michigan Economic and Commercial Real Estate Forecast. The event will be held at DeVos Place in Grand Rapids; breakfast begins at 7:15 a.m. and presentations at 8 a.m.