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US healthcare spending registers smallest growth since 1960
[NEW YORK] US healthcare spending last year increased 3.6 per cent over 2012, the smallest rate of growth since 1960, government officials announced on Wednesday.
The modest increase, down from the 4.1 per cent increase from 2011 to 2012, continued a trend that began with the 2007-2009 recession, and is a dramatic change from the double-digit growth of a decade ago. It fed hopes that more price-conscious consumers, as well as policy initiatives like Obamacare, are reining in US healthcare spending, the world's highest and a drag on both the federal budget and corporate balance sheets.
Per capita growth slowed even more, from 3.4 per cent in 2012 to 2.9 per cent last year, found the Centres for Medicare and Medicaid Services (CMS).
Healthcare spending in 2013 totaled US$2.9 trillion, or US$9,255 per person. It accounted for 17.4 per cent of gross domestic product, the same percentage as it has since 2009.
The analysis found that prices of doctor visits, hospital care, nursing homes and other healthcare services grew 1.3 per cent, more slowly than the overall inflation rate of 1.5 per cent.
That modest increase likely reflects pressure that both private insurers and Medicare are putting on providers, as well as President Barack Obama's healthcare reform, which put checks on what providers charge Medicare, the government program for the elderly and disabled.
Americans used hardly any more medical services in 2013 than in 2012, despite the aging and growth of the population. Use of such services rose 1 percent, after a 1.2 percent rise in 2012, largely due to lower growth in hospital care.
The historically small rise in healthcare spending occurred across the board, in both private health insurance and Medicare.
Premiums for private insurance rose 2.8 per cent compared to 4 per cent in 2012, reaching US$961.7 billion. What private insurers paid out in claims (US$846 billion) also rose more slowly: 2.8 per cent vs. 4.4 per cent in 2012, largely because of slower growth in spending for hospitals and doctors.
Medicare spending rose 3.4 per cent, compared to 4 percent growth in 2012, to US$585.7 billion. Spending by the Medicaid program for the poor, however, rose 6.1 per cent.
CMS warned that healthcare spending will grow more sharply if economic growth accelerates. "Historical evidence suggests it will," said statistician Micah Hartman.