In this photo taken September 1, 2010, Douglas Holtz-Eakin speaks on Capitol Hill Washington.
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Other factors led to the increase in health spending in 2014, including a big increase in spending on prescription drugs, which is projected to have grown about 12 percent in 2014 from 2.5 percent in 2013.
NEW YORK, July 28 The U.S. government expects healthcare spending to increase by 5.8 percent annually on average from 2014 through 2024 as more Americans gain insurance coverage and the improved economy drives patients to visit doctors and hospitals.
– Expanded coverage under President Barack Obama’s health care overhaul.
This is fueled largely by new, high-cost specialty drugs for treatment of hepatitis C and, to a lesser extent, new treatments for cancer and multiple sclerosis.
Health spending will continue to grow faster than the economy for the next decade, Medicare actuaries say. The increase in later years is attributed to expected stronger economic growth, which usually is followed by increased use of health-care goods and services.
In addition to 2014’s estimates, the agency projects that spending growth will slow slightly to 5.3 percent in 2015 and maintain that rate from 2016 to 2018. “In private health insurance, more of the cost is being pushed onto consumers”, John Poisal, deputy director of the National Health Statistics Group at the office of the actuary, said at Tuesday’s event.
Medicare, which publishes the spending projections, estimates that 8.4 million Americans gained coverage in 2014.
Growth in spending hit historical annual lows between 2008 and 2013 of about 4 percent. For 2014, the projected increase is 12.6 percent, according to the report.
Spending on Medicaid, which covers low-income Americans but kicks in to pay for nursing home care when people have depleted their assets, is projected grow by 5.9 percent from 2019 to 2024. Likewise, the spike in drug costs will work its way through the system as government programs and insurers demand rebates from the manufacturers of hepatitis C drugs.
Leading author of the research and the adviser of the United States Department of Health and Human Services, Dr. Benjamin Sommers said, ” Trends for these measures before the Affordable Care Act were significantly worsening for all outcomes”. Other competing priorities such as education and infrastructure can get short- changed. The number of enrollees is increasing each year, as 19.1 million baby boomers are expected to age into the program.
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“If there’s a political implication of this, it’s to find those areas where there are proven or likely cost savings, and aggressively go after them through Medicare”, Mendelson said. The new findings appear as a Health Affairs Web First article and will appear in the journal’s August issue.
