Jan. 16 — Amid debate on how to reduce federal spending on health care, a new report shows that U.S. health spending growth stayed at 3.9 percent in 2011, the same rate of growth as in 2009 and 2010. However, personal healthcare spending growth accelerated slightly in 2011—from 3.7 percent to 4.1 percent—in part because of faster growth in spending for prescription drugs and physician and clinical services.

According to Centers for Medicare & Medicaid Services (CMS) National Health Expenditures data published in the January 2013 issue of Health Affairs, U.S. healthcare spending reached $2.7 trillion in 2011, or $8,680 per person. National health spending and nominal gross domestic product grew similarly in 2010 and 2011, with health spending as a share of GDP remaining stable from 2009 through 2011, at 17.9 percent. 

Spending for hospital care increased 4.3 percent to $850.6 billion in 2011, a slower growth rate compared to 4.9 percent growth in 2010. That slower growth was influenced by a slowdown in price growth and continued low growth in the use of hospital services, according to the data. Medicaid spending on hospital services slowed in 2011, while private health insurance and Medicare hospital spending accelerated. 

HFMA Analysis: A number of factors are slowing cost growth. Obviously, the weak economy is one. However, now that we’re more than three years removed from the bottom of the economic downturn, it’s fair to assume that changes in benefit design (e.g., increasing penetration of high-deductible plans, tiered networks), care delivery (such as the impact of physician-led efforts, including the ABIM Foundation’s Choosing Wisely initiative, and continued shifting of services to outpatient settings), and migration to value-based reimbursement models are exerting downward pressure on cost growth. 

For more information about the study, visit this website.

Publication Date: Wednesday, January 16, 2013