Study: Health spending to rise back to historic levels


Healthcare costs will return to historic averages of about 7 percent by 2019 compared to the 3.9 percent from 2009 to 2011, which was the lowest growth rate since 1960, according to a new study from the Kaiser Family Foundation.

That's because the decreased spending on healthcare the last few years was primarily due to the national recession. "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. 

In fact, the authors blame the economy for 77 percent of the reduced growth in national healthcare spending, which totaled about $2.8 trillion in 2012. The other 23 percent stemmed from changes in the health system, including higher patient deductibles.

"The run-up to the Affordable Care Act, and the initiatives put in place by the law, are absolutely having an effect," Larry Levitt, senior vice president of the Kaiser Family Foundation, told The Washington Post's Wonkblog. "I think providers and payers see health reform coming and they want to get ready to lower their costs."

But Levitt and Kaiser Family Foundation President Drew Altman believe key industry players--including insurers--can still take steps to help moderate rising healthcare costs.

"If public- and private-sector efforts to contain healthcare costs continue to take hold, and new efforts are instituted, we could potentially shave a percentage point off the annual increase and perhaps a little more--saving more than $2 trillion from the national healthcare bill over a decade," they wrote in a Washington Post editorial.

To learn more:
- here's the study
- read the Washington Post's Wonkblog article
- check out the Kaiser Family Foundation editorial

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