• Morris L Barer, Robert G Evans, Kimberlyn M McGrail, Bo Green, Clyde Hertzman, and Samuel B Sheps.
• Centre for Health Services and Policy Research, Department of Health Care and Epidemiology, University of British Columbia, 2194 Health Sciences Mall, Vancouver, BC V6T 1Z3, Canada.
• CMAJ. 2004 Mar 2; 170 (5): 803-7.

BackgroundAlthough expenditures on health care are continually increasing and often said to be unsustainable, few studies have examined these trends at the level of services delivered to individual patients. We analyzed trends in the various components that contributed to changes in overall expenditures for physician services in British Columbia from 1985/86 to 1996/97.MethodsWe obtained data on all fee-for-service payments to physicians in each study year using the British Columbia Linked Health Data set and analyzed these at the level of individual patients. We disaggregated overall billing levels by year into the following components: number of physicians seen by each patient, number of visits per physician, number of services rendered on each visit and average price of those services. We removed the effect of inflation on fees by adjusting to those in 1988. We used direct age-standardization to isolate and measure the effect of demographic changes. We used the Consumer Price Index to determine the effects of inflation.ResultsTotal payments to fee-for-service physicians in British Columbia rose 86.3% over the study period. The increase was entirely accounted for by the combined effects of population growth (28.9%), aging (2.1%) and general inflation (41.4%). Service use per capita rose 10.5%; this increase was offset by a decline of 9.4% in inflation-adjusted fees. The average cost of age-adjusted per-capita services rendered by general or family practitioners (GP/FPs) increased very little (3.3%) over the 11-year period, compared with a nearly one-third (31.8%) increase for medical specialists. Although there was a dramatic increase in the number of GP/FPs seen on average by each patient (32.9%), this increase was offset by the combination of decreases in the number of visits per physician (-14.9%), the number of services provided per visit (-8.0%) and the "real cost" of each service provided (-3.5%). Visits to medical specialists increased by about 20% over the study period in all age groups. However, for each person 65 years of age or over receiving any services, the average fee-adjusted expenditures increased 24.8%, almost 4 times the rate of increase for people younger than 65. The use of surgical services grew 26.5% for seniors while declining -2.0% for people under age 65.InterpretationThese findings suggest a form of "homeostasis" in aggregate-level service use and cost. The supposed inflationary effects of population aging and increasing "abuse of the system" by patients were not found.

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