The slowdown in health spending growth was seen broadly across all major forms of private and public insurance, and in medical services, prescription drugs and other goods, according to an official analysis released Wednesday. Dating back to 1960, the NHEA measures annual USA expenditures for health care goods and services, public health activities, government administration, the net cost of health insurance, and investment related to health care.
Hartman, a statistician with the Office of the Actuary at CMS, said that he has not seen as broad a deceleration in healthcare spending growth since 2010.
But things had sped up again in 2014-2015, the authors noted.
Medicare, the federal health program for the elderly, and Medicaid, the government's program for the poor, each reduced spending and fewer people enrolled in private health insurance following a big coverage expansion under Obamacare. Also, those years, saw rapid spending growth for retail prescription drugs. The reflects a decrease in the use and intensity of services, due to slower enrollment growth.
On a per capita basis, national health spending grew at 3.5%, reaching $10,348 in 2016. "Per capita spending on healthcare increased by $354, reaching $10,348". Hospital care expenditure growth slowed from 5.7% in 2015 to 4.7% in 2016.
The slower growth is primarily due to decelerated spending for retail prescription drugs, hospital care, and on physician and clinical services, according to the Office of the Actuary report. "Additionally, medical price inflation was at historically low levels, in part because of lower economywide price growth and various legislative actions aimed at slowing health care spending growth". "Over the past ten years the health sector has experienced major changes influenced largely by overall economic conditions, a low inflationary environment, and a more recent dramatic increase in health insurance coverage associated with the Affordable Care Act (ACA)", the article's authors wrote. However, spending growth slowed to 3.6 percent from 4.8 percent in 2015, driven by slower spending per enrollee on both the fee-for-service and Medicare Advantage portions of the program.
The 8.2% spending growth for clinical services almost doubled the 4.6% growth in spending for physician services for the twelfth consecutive year. The growth in clinical services spending was driven primarily by continued strong growth in spending for freestanding ambulatory surgical and emergency centers.
The numbers are in comparison to 2014 and 2015, CMS said, which saw major enrollment through Medicaid expansion and individual health insurance through the Affordable Care Act. Despite the slower growth in 2016, healthcare spending still increased faster than the GDP growth rate.
Private health insurance spending climbed 5.1 percent to $1.1 trillion a year ago, Medicare spending increased 3.6 percent to $672.1 billion, and Medicaid spending rose 3.9 percent to $565.5 billion. Medicare spending slowed because of lower per enrollee growth rates.
US health spending rose to $3.3 trillion in 2016, but the pace slowed compared to the previous two years as demand for drugs, hospital care and physician services weakened, according to a federal study released Wednesday. Private health insurance continued to be the largest payer for health care goods and services in the USA in 2016-accounting for just over one-third of total healthcare spending. This was mainly due to slower growth in enrollment and retail prescription drugs and a shift to higher deductible plans.
But because health spending grew faster, as it has for years, than overall gross domestic product, health spending's share of the economy increased to 17.9 percent in 2016, up from 17.7 percent of the economy the year before.
In other words, inflation in overall USA healthcare spending has now returned to something like "normal", at least as gauged by historically predictive patterns.
This compares to a growth rate of 4.8 percent in 2015. "As a result, health care spending increased 5.1 percent in 2014 and 5.8 percent in 2015".