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Mar
18

Healthcare Spending In Action


US Healthcare SpendingThe news has been filled with stories about the rising costs of healthcare in the last several years. During the adjustment to Obamacare, it’s expected that prices might spike additionally as companies get used to new requirements and retool some products. The good news, however, is that health care spending is growing less now than it was in previous years.

According to USA Today, the rates of healthcare spending are the slowest in the last 50 years.  Rather than spikes in spending, the healthcare industry has experienced sustained periods of modest growth. It’s not just general healthcare spending, either- Medicare spending based on a per-beneficiary basis is also growing at historically slow rates (in fiscal year 2012, per-beneficiary spending rose by .4% compared with general economic growth of 3.4% per person).

This is good news for the implementation of the Affordable Care Act, which has an underlying goal of making quality care affordable and accessible, with costs ultimately being pressed down over time due to increased coordination. There are, of course, several reasons that the costs are growing less. First of all, more people are obtaining their health insurance coverage and needs under government programs like Medicare and Medicaid. These two programs pay less to doctors than other private insurance companies might pay out. Second, some people may be foregoing particular care (such as optional surgeries) due to the recession. Third, health insurance exchanges are on their way in, and preliminary talks have resulted in lower rates for hospitals and doctors, with promises of higher volumes instead. Finally, the availability of many generic drugs have helped to cut down prescription drug cost for people throughout the country.

It’s likely that the government will be watching healthcare spending trends for the next few years. Any decreases will be explored in order to continue the decreased growth of costs. The focus towards managed care and various mandates will cause a lot of shifting around and new ways of doing business, but the underlying goal is to keep costs lower and have more people invest in their preventive care. Of course, final prices from insurers won’t be revealed for several months, but customers going through a health insurance exchange will have multiple options to choose from. This does mean that there’s a job on the consumer’s part to educate themselves about their needs and which plans would be best suited for them and their family.

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