Health Care Spending Slowing, but Still Growing
Jan. 9, 2007 — -- The United States continues to have the highest per capita health care spending among industrialized countries, but a new study published in the journal Health Affairs suggests we might finally be turning the tide.
The rate of growth in U.S. health care spending slowed for the third straight year in 2005. The study's authors, who work for the centers for Medicare and Medicaid Services, say this marks the slowest growth rate in health spending since 1999, when enrollment in more tightly managed care plans peaked.
But while this is a positive development, the bottom line is that the spending may continue to increase, despite the slowdown.
"Every year, when rates-of-spending increases are slightly lower than the year before, some people try to spin this as good news," said Alan Sager, professor of health policy and management and director of the Health Reform Program at Boston University School of Public Health. "What it really means is that we're driving at high speed toward the edge of the cliff, but not quite as quickly as last year. Is this drop in speed meaningful? No."
Others agree that we need to be cautious.
"Any celebration is premature," said Karen Davis, president of the Commonwealth Fund, a private foundation that aims to promote a high-performing health care system. "The United States still spends a staggering $6,697 per person per year on health care, more than twice what any other industrialized country spends. And even the slower spending growth of 6.9 percent continues to outpace inflation and growth in wages for the average worker in the United States."
The health care spending slowdown was not unexpected.
"The slowdown was expected and is important," said Gail Wilensky, an economist and senior fellow at Project HOPE, a private organization that works to achieve sustainable advances in health care around the world. "But whether this slowdown will continue is another matter. Many of the changes are likely to be either 'one-off' or of limited duration."
Related Stories
ABC News Live