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  • Weak Economy Is Biggest Cause of Slow Growth in Health Spending, Kaiser Says

    The nation's recent recession, far more than changes in the health care system, is the main cause of slow growth in health care spending, says a new study commissioned by the Kaiser Family Foundation and conducted by the Altarum Institute. Some 77% of the recent decline in health care spending can be attributed to broader changes in the economy, Kaiser says, with structural changes in the health care system "playing a modest role."

    According to the Centers for Medicare and Medicaid Services Office of the Actuary, health care spending grew by 3.9% annually 2009-2011, the smallest increase since the federal government began tracking the statistics in 1960, with a small increase to 4.3% in 2012.

    Because health care spending is a major driver of federal and state budgets, Kaiser commented, determining whether or not the growth pace will pick up or remain sluggish has major implications. To the extent it's recession-driven, health care spending potentially will bounce back with the economy; to the extent it's affected by structural changes, historically low growth rates could continue. The analysis suggests it's premature to credit policy and marketplace changes with the slowdown in spending growth, but it notes that major elements of the Accountable Care Act "have not yet been implemented and could dampen growth in the future."