Article: HOSPITALS DRIVE HEALTH COSTS DEMAND FOR SERVICES NOW SPURS MEDICAL INFLATION MORE THAN PRESCRIPTION DRUGS.(News)

Byline: P-I NEWS SERVICES

A new study indicates that increased spending for hospital care, rather than prescription drugs, accounted for the largest share of health care inflation last year.

"Hospital spending is back with a vengeance, and the likely causes are the retreat from tightly managed care, which has increased demand for hospital services, and rising labor costs," said Paul Ginsburg, president of the Center for Studying Health System Change, a non-partisan research organization that conducted the study.

Overall, health costs rose 7.2 percent last year, the largest jump in a decade, and inpatient and outpatient hospital care costs ...

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