OCA: utilization mostly flat or down, but high‑cost member share rose markedly

Analysts told the board that utilization frequency alone does not explain the rapid spending increases; instead, shifts in chronic‑condition prevalence and a larger share of very high‑cost patients appear to be important contributors.

"The utilization rate decreased by 4.2% [in commercial] while remaining flat in the Medicare Advantage market," Andrew Fair said, summarizing the HPD analysis. He reported that average commercial encounters per member fell about 3% from 2022 to 2024, while the share of enrollees diagnosed with at least one chronic condition increased from about 30.1% to 33.0% in the commercial market. The proportion of members exceeding $1,000,000 in annual spending remained small (~0.1%) but rose by over 25% in commercial plans (roughly 360 additional million‑dollar claimants in the dataset).

Board members pressed staff for more granular measures of utilization intensity — emergency department visits, hospital admissions and procedure counts — arguing that encounter counts and presence/absence of claims are imperfect proxies for clinical intensity. Staff acknowledged limitations (claims‑based diagnoses, encounter counts that treat prescription fills and an ER visit similarly) and said future work will explore intensity measures and condition‑level drivers for high‑cost cases.

Public commenters and board members requested follow‑up analyses to identify whether very high‑cost cases are dominated by pharmaceuticals, inpatient stays, or new therapies (CAR‑T, gene therapy), and recommended linking claims intensity and service categories to better quantify price vs utilization contributions to TME growth.