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Slow Health Care Spending Growth Not Just Due To Economy, Studies Suggest

05/07/13

  04:45:16 pm, by MedBen5   , 244 words,  
Categories: News, Health Plan Management

Slow Health Care Spending Growth Not Just Due To Economy, Studies Suggest

The economic downturn of recent years is not the overriding factor for the slower growth in health care spending, two new studies suggest. The findings contradict earlier speculation that the slowdown was due primarily to the latest recession, which lasted 18 months and ended in June 2009.

According to Modern Healthcare, one of the studies found that the economy accounted for about 37%, of the slowdown, while cuts to Medicare and a decline in privately insured patients accounted for another 8%. “The evidence is at least as strong that it’s structural as it is cyclical,” said David Cutler, a health care economist and professor at Harvard University who co-authored the paper.

The second paper, which analyzed spending by 150 large employers from 2007 to 2010, concluded that larger deductibles, more coinsurance and higher copayments accounted for about 20% of the slowdown. Co-author Michael Chernew, a Harvard health policy professor, added that the results appear to underscore a shift in culture among hospital officials and physicians who have grown more focused on greater efficiency in the last five years.

While neither paper went so far as to say that improvements in the payment and delivery of health care have had a definitive effect on spending, the authors say they believe as the economy improves, growth will continue to be slower than it was prior to the downturn.

National health spending grew at a record-slow pace of 3.9% in 2009 and the same pace in 2010 and 2011, the most recent year for which federal estimates are available.

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