Study predicts rise in healthcare cost growth by 2019

via The Hill

A stronger U.S. economy will contribute to a rise in the growth of healthcare costs over the next six years, ending the current record-breaking slowdown, according to a new study.

The Kaiser Family Foundation (KFF) predicted that by 2019, annual healthcare cost growth will be closer to historic averages — over 7 percent compared to 3.9 percent between 2009 and 2011.

“As the economy recovers, health spending is likely to trend upwards, though growth rates are unlikely to return to the double-digit levels we have seen in the past,” the authors wrote.

The analysis attributed most of the current lag (77 percent) to economic factors, but predicted that ObamaCare could play a role in bending the healthcare cost curve in future years.

“Our analysis suggests that over time, the economy is by far the biggest determinant of changes in health spending overall,” the report stated.

“At the same time, however, there are also indications that structural changes in the health system may be playing a modest role as well.”

The analysis contributes to a debate about the Affordable Care Act (ACA) and whether it will help to curb the rate of growth in U.S. healthcare spending.

The report cited several provisions — including the law’s Medicare savings, its delivery-system reforms, and its tax on high-cost health plans — that are designed to lower spending, but it did not explicitly account for these factors in its analysis.

Authors warned critics of the ACA that they should not blame rising healthcare cost growth on the law over the next several years.

“This [rise] will likely coincide with an expected economic recovery, so higher growth rates in health spending due to that recovery should not be attributed to the ACA simply because of the coincidental timing,” they wrote.

The statistical model behind the numbers was developed by the Kaiser foundation and the Altarum Institute’s Center for Sustainable Health Spending.

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