Factors Affecting Medical Trend: Inflators

Physician employment

Once hospitals and health systems acquire in-house physician practices, they have the ability to immediately escalate physician charges to the higher hospital rate, which will trigger a rise in spending next year.

  • In April 2014, Highmark, Inc., a Pennsylvania-based insurance company, accounced that it would no longer reimburse at the hospital-based rate for cancer treatments performed in outpatient offices. The insurer believes that it will subsequently reduce claims by $200 million per year.
Physician employment