NCPA - National Center for Policy Analysis

Cost of Cosmetic Surgery Declined During Past Decade

May 7, 2003

Although prices for health care services have risen almost twice as fast as consumer prices generally over the past decade, prices for cosmetic surgery are actually lower in real terms, according to the National Center for Policy Analysis (NCPA).

The key difference, according to the NCPA, is who pays the bill. Third parties (insurers, employers and government) pay most of the costs of health care. But cosmetic surgery is almost always paid by patients out of their own pocket.

Among the factors that keep cosmetic surgery prices low are the following:

  • Cosmetic surgeons search for ways to be efficient; for example, performing operations in their offices, rather in a hospital.
  • Cosmetic surgeons often quote patients a package price, and Web sites offer competitive bids for surgical procedures.
  • When procedures become pricey, substitute products quickly emerge; for example, laser resurfacing, Retin-A treatments, botox or collagen injections, chemical peels and dermabrasion can replace the need for a costly facelift.

The report says that an explosion of third-party payment of medical bills through Medicaid (for the poor), Medicare (for the elderly) and private insurers is chiefly responsible for medical inflation in the modern era.

Prior to the advent of Medicare and Medicaid, health care spending never exceeded 6 percent of gross national product; now it's 14 percent.

Source: Devon Herrick, "Healthcare Prices Aren't Rising When Patients Pay The Bill:

Real Costs of Cosmetic Surgery Fell Over the Last Decade," Brief Analysis No. 437, National Center for Policy Analysis, May 7, 2003.

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