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U.S. Health Spending Rises More Slowly, Hits 2.6 T (That's Trillion)

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Just out in the journal Health Affairs: The recession has slowed down the annual growth in the nation's health-care bill to 3.9%, but the slowing seems to come mainly from strapped people passing up needed care. And the total still comes to a nearly unimaginable $2.6 trillion, or $8,402 per person.

[module align="right" width="half" type="pull-quote"]'A trillion seconds ago was 30,000 BCE'[/module]

Actually, not so unimaginable: I just got some help picturing a trillion from Stuart Altman and David Shachtman's new book, "Power, Politics and Universal Health Care." They quote Oregon Governor John Kitzhaber as telling audiences that a million seconds ago was just last week, a billion seconds ago Nixon resigned the presidency in 1974, and a trillion seconds ago was 30,000 BCE. Ullp. Per person, countries like Canada, Germany and France spend less than half what we do, they note.

From the Health Affairs press release:

Bethesda, MD— An extraordinary slowing of the growth in use of health care goods and services contributed to a second year of slow health spending growth in 2010, federal analysts reported in the January issue of Health Affairs. Persistently high unemployment, a substantial loss of private health insurance coverage, lower median household income, and the burden of increased cost sharing led people to forgo care or seek less expensive treatment options.

As a result, growth in national health spending remained low in 2010, following a similar and historically low rate of growth in 2009, according to analysts at the Centers for Medicare and Medicaid Services (CMS). Health spending grew 3.9 percent, only 0.1 percentage point faster than in 2009. Total health spending for 2010 reached $2.6 trillion, or $8,402 per person.

The rates of health spending growth in 2009 and 2010 marked the two slowest rates in the fifty-one-year history of the National Health Expenditure Accounts. “Even though the recession officially ended in 2009, its impact on the health sector appears to have continued into 2010,” according to the article. “[The recession’s impact] was a little more dramatic in 2010 because of a large decline in personal health care spending,” says CMS economist Anne Martin, the article’s lead author. “Medical goods and services are generally viewed as necessities, but the recession led consumers to be a lot more cautious about utilizing them.”

Slower growth in spending for hospital services, physician and clinical services, and retail prescription drugs reflected slower growth in the use of these goods and services in 2010. Other contributors to overall low growth included slow growth in private health insurance and out-of-pocket spending, and slower growth in Medicare and Medicaid spending.

 

This program aired on January 9, 2012. The audio for this program is not available.

Carey Goldberg Twitter Editor, CommonHealth
Carey Goldberg is the editor of WBUR's CommonHealth blog.

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