Although medical costs have increased steadily for decades, the rate of growth has been slowing in each of the past five years. No more, however: In 2009, the downward trend is expected to level off, and actual medical costs are expected to grow 9.6 percent, according to a new PricewaterhouseCoopers Health Research Institute (HRI) report, Behind the Numbers: Medical Cost Trends for 2009. The report is based on HRI analyses and a survey of more than 500 employers and provider-based health plans.
According to the report, multiple factors are expected to help drive medical cost increases in 2009, including booming healthcare construction and increasing cost-shifting from the uninsured, Medicare, and Medicaid to private payers. Also, a recession in 2009 could result in higher costs, since medical price growth historically has risen faster during recessions. The outcome of this year’s elections also could have an impact: If a Democratic president takes office in 2009 and puts in place initiatives to expand coverage of the uninsured, cost-shifting could be reduced, which may benefit employers and workers, but also may increase taxes. Access the report.
