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OKA posts facility dataset showing commercial inpatient spending roughly double Medicare, finds big hospital-level volatility
Summary
New OKA facility-level measures for FY2022–23 show median commercial inpatient spending per case rose to about $23,600 (+7.1%) and commercial rates exceed Medicare by more than 200%; staff cautioned about year-to-year volatility, data limitations and plans for further validation.
The Office of Healthcare Affordability posted a facility‑level dataset and methods document for hospital inpatient and outpatient spending for fiscal years 2022 and 2023, and presented headline findings at its April 21 board meeting.
Research staff said they combined three sources — hospital financial reports, the state patient discharge dataset and the Healthcare Payments Data — to produce payer‑specific, intensity‑adjusted measures. "Median intensity‑adjusted commercial inpatient spending rose from about $22,000 in 2022 to about $23,600 in 2023," Research Manager Andrew Far told the board. "Commercial inpatient and outpatient medians are well above Medicare — in many measures above 200% of Medicare."
OKA presented several caveats. The outpatient intensity adjustment relies on ambulatory payment classification (APC) weights and the HPD, which currently captures a limited share of self‑insured commercial claims; a substantial number of outpatient commercial visits lacked APC codes in the datasets, and the crosswalk between NPIs and facility license numbers required substantial hospital input and corrections. Staff said hospital feedback in February led to improvements in mapping and increased the count of APC‑coded commercial outpatient visits from 1.7 million to about 3.0 million for FY2022 in their updated analysis.
The dataset also revealed large hospital‑level volatility: after censoring extreme outliers staff observed hospital growth rates ranging from large declines to more than 100% increases, and roughly 10% of hospitals had year‑to‑year growth at or above 50% in either inpatient or outpatient measures for the 2022–23 window. Several board members and industry commenters urged caution, noting that nonoperating revenue swings (investment gains, one‑time items) and accounting reclassifications explained some anomalies and that a longer time series is needed before using these measures for enforcement.
OKA said it will publish results annually and continue to refine the crosswalk and intensity adjustments; the office pledged to seek hospital input again before analyzing FY2024 data.
The dataset, method documentation and issue brief are posted on the office website for public review.
