Alaska News

Study: Health care costs in Alaska top nation's cities

A recent cost-of-living index highlighted what many Alaskans already know: Living up north is pricey, from groceries to housing to utilities. But only in one category -- health care -- did four of the state's cities top the nation.

Juneau placed first, then Fairbanks and Kodiak, with Anchorage named fourth for most costly health care, followed by Everett, Wash., and Boston, according to a report released last week by the Council for Community and Economic Research. The organization of researches measured some 300 cities based on the average 2013 prices for visits with optometrists, dentists and physicians.

In Anchorage, the report said, the average cost for a full vision eye exam was $166, nearly 72 percent higher than the national average. A general physical was also priced at $166 and a teeth cleaning at $124, about 63 and 42 percent more than what the average person pays in the United States.

Some health professionals blamed Anchorage's high prices on exorbitant cost drivers like rents, salaries and shipping. Economists said expensive health care affects the entire community, from schools to businesses to health insurance companies. Both said they've started to form coalitions to combat the costs.

"This isn't just a low-income issue, it's a community issue," said Bill Popp, president of the Anchorage Economic Development Corp., which collected the data for the national organization. "This affects everybody."

Julie Taylor, the chief executive officer of Alaska Regional Hospital, moved to Anchorage from Colorado in January. A few things are different here, she said. Nurses and doctors earn at least 30 percent more, and that doesn't include relocation expenses or sign-on bonuses.

"You pay tens of thousands of dollars to get them up here and then you hope they stay," she said about Alaska where the only medical school is a collaborative one between five northwestern states. "Some people can come up here and live here for three years and then they say, 'We're going back to the Lower 48.'"


Taylor has trouble hiring on-call doctors and nurses because it's hard to persuade new hires without a promise of steady hours, so she must keep a full staff at all times, she said. Construction costs are higher, utility costs are higher and most supplies are shipped in. Plus, when patients are too poor to pay for care, that cost is passed on to others consumers. "It comes into the cost of doing business," she said. "We're all paying for it."

The Alaska Health Care Commission, established by a Senate bill in 2010, has published a number of studies examining the state's costly health care system. "It's definitely a problem," said Deborah Erickson, the commission's executive director. Health care spending in Alaska reached $7.5 billion in 2010, she said.

Pricey health care triggers increased health insurance costs, she said. She cited a 2011 report that found Alaska had the highest average annual cost for employee health benefits in the nation at $11,926 per employee. A 2013 report said that Alaska had the second highest per capita health care spending in the nation, only behind Massachusetts.

Popp described Alaska health insurance prices as a "headwind" to the growth of the economy.

Health insurance was identified as one of the two top barriers facing Anchorage business owners, the other federal regulations, in a 2014 report published by the Anchorage Economic Development Corp. that surveyed more than 220 businesses and organizations.

Popp has started to reach out to hospitals and local businesses to come up with solutions to rising health care costs. He expects a first meeting next month. At the Anchorage Community Land Trust, Kirk Rose, community development director, said a partnership is in the beginning phases between the University of Alaska Anchorage, health care facilities and insurance companies to uncover data on health access and costs, specifically in the Mountain View neighborhood.

Reach Tegan Hanlon at or 257-4589.

Tegan Hanlon

Tegan Hanlon was a reporter for the Anchorage Daily News between 2013 and 2019. She now reports for Alaska Public Media.