New <em>Health Affairs</em> Issue: Will The Health Care Spending Growth Slowdown Last?

Abstract

Health Affairs’ May issue, released today, analyzes the recent slowing in the growth of health care expenditures and explores whether the trend will last. The issue also addresses major cost drivers in Medicare and presents proposals for putting the program on a more sustainable path. Another article tracks federal spending on mental health during severe state budget constraints throughout the recession. As Health Affairs Founding Editor John Iglehart notes on his "From The Founding Editor" page (quoted at length below), the new thematic volume, "Tackling The Cost Conundrum," continues the journal's coverage of a topic that has been a "driving theme" of the journal since its inception. The May issue will be discussed at a National Press Club briefing tomorrow morning, Tuesday, May 7. The issue and briefing are supported by a grant from the Robert Wood Johnson Foundation. Researchers writing in the new issue are cautiously optimistic that the slowdown in health care spending is here to stay. A study by Michael Chernew, Alexander Ryu, and colleagues at Harvard Medical School looks at two factors potentially contributing to the record slowdown in growth to 3.1 percent during 2007-11: job loss and benefit changes shifting costs to the insured. Analyzing National Health Expenditure Accounts and large-employer data, the authors found that benefit design changes that increased enrollees’ out-of-pocket costs were responsible for about one-fifth of the observed decrease in the rate of growth. However, the slowdown occurred even when benefit generosity at large firms was held constant. The authors suggest that other factors are largely responsible and that major events, such as health reform, shifts in payment methodology, and the transformation of the delivery system’s organization may contribute to a longer-term trend of slower spending growth. In a related article, David Cutler and Nikhil Sahni of Harvard University conclude that fundamental changes, including less-rapid development of imaging technology and new pharmaceuticals, increased patient cost-sharing, and greater provider efficiency, led to the majority of the slowdown in health care spending growth; if this path continues for the next ten years, public-sector health care spending could wind up $770 billion under projections, they write.