Health care costs to reach nearly one-fifth of GDP by 2021

Published on June 14, 2012 at 7:31 AM · No Comments

New health care cost projections released Tuesday by the Centers for Medicare & Medicaid Services indicate that the nation's health care spending will keep outpacing economic growth despite a recent slowdown.

The Wall Street Journal: Steep Rise In Health Costs Projected
Economists have been puzzling over whether a three-year slowdown in the growth of health-care spending, prompted by the economy, portends a permanent change. Federal projections indicate that isn't the case (Radnofsky, 6/12).

The Associated Press: Gov't Report: Health Cost Relief Only Temporary
If only the economy were growing as fast. Despite a recent easing of medical costs, the nation's health care spending will keep outpacing economic growth for the foreseeable future, government experts said Tuesday in a forecast that signals more upheaval for Medicare and Medicaid, as well as private insurance. President Barack Obama's health care overhaul will add $478 billion in spending over the 2011-2021 period covered by the projections, expanding coverage to some 30 million uninsured people (Alonso-Zaldivar, 6/12).

Reuters: Government Forecasts Modest Health Spending Growth
The annual growth rate for U.S. healthcare spending will hover near historic lows in 2013 and rise at a modest pace for much of the next decade, even if the Supreme Court allows the expansion of coverage to millions more Americans to proceed, a government report said on Tuesday. The U.S. Centers for Medicare and Medicaid Services said healthcare spending will rise about 4 percent a year between now and 2014, when President Barack Obama's reform law takes full effect and provides coverage to more than 30 million uninsured Americans (Morgan, 6/12).

Kaiser Health News: Capsules: Report: Health Spending Will Climb To Near One-Fifth Of GDP
National health spending will account for nearly one-fifth of the U.S. economy in 2021, according to updated estimates from the federal government (Torres, 6/12).

Bloomberg: Health-Care Spending To Reach 20% Of U.S. Economy By 2021
An aging population, improving economy and President Barack Obama's health-care overhaul will push spending on medical services to almost 20 percent of U.S. gross domestic product by 2021, the government projected. Spending on hospital visits, medications and other health care rose an estimated 3.9 percent in 2011 and consumed about 17.9 percent of GDP, the same as the previous two years, the Centers for Medicare and Medicaid Services said yesterday. The increases in such expenditures will continue to outpace economic growth projections, jumping 7.4 percent in 2014, when much of the insurance expansion created by the health law begins (Wayne, 6/13).

Politico: Projections: ACA Will Have Small Impact On Spending Growth
Health care spending will spike in 2014 as millions of people gain coverage, but the overall rate of annual growth for the decade ending in 2021 will average 5.7 percent -; 0.9 percentage point faster than the economy, according to new Centers for Medicare & Medicaid Services projections released Wednesday (DoBias, 6/12).

CQ HealthBeat: The Overhaul's Impact On U.S. Health Spending: A Lot Or A Little?
Depending on who you talk to, the health care law either is a luxury the nation can't afford or a pretty good deal. Ten-year spending projections government economists issued Tuesday provide analysts on both sides of the debate with statistics they can cite to depict the overhaul the way they want. Those who think the law costs too much are likely to note that over the next few years national health spending is going to grow at unusually low rates, according to the projections issued by the Office of the Actuary at the Centers for Medicare and Medicaid Services But when coverage expansion kicks in fully under the health law in 2014 -; assuming it takes effect -; the growth rate will jump (Reichard, 6/12).

MedpageToday: ACA To Trigger Growth Spurt In Health Spending
Healthcare spending in the U.S. is expected to continue to grow slowly over the next year and a half, but then speed up in 2014 when a number of provisions of the Affordable Care Act (ACA) kick in, according to a report from economists and actuaries at the Centers for Medicare and Medicaid Services (CMS). And, by 2021, health care costs will equal 19.6% of the nation's gross domestic product (GDP), up from 17.9% in 2011, Sean P. Keehan, an economist in the CMS Office of the Actuary, told reporters at a Tuesday morning press conference (Walker, 6/12).

The Dallas Morning News: Health Care Law Trades Spending For Greater Insurance
Without the 2010 health care overhaul, the nation would spend $478 billion less over the next decade but leave 30 million Americans without health insurance, federal health economists projected Tuesday. The Supreme Court is expected to rule this month on the constitutionality of the law's insurance mandate, and Republicans have vowed to repeal the entire act. Economists with the federal Centers for Medicare and Medicaid Services would not comment on the consequences of repeal. But they said the law increases health spending by an average of 0.1 percent a year (Landers, 6/12).


http://www.kaiserhealthnews.orgThis article was reprinted from kaiserhealthnews.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.

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