CMS finds growth in health spending remained slow in 2011

AHA News

U.S. spending on health care grew 3.9% in 2011, marking the third straight year of record-low growth, the Centers for Medicare & Medicaid Services (CMS) reported Jan. 7 inHealth Affairs. It marked the lowest annual rates recorded in the 52 years the government has been collecting such data.

Growth in spending for hospital care slowed to 4.3% from 4.9% in 2010, due to slower growth in hospital prices, use of
hospital services and Medicaid spending for hospital care, CMS said.

“The report echoes AHA’s most recent data and shows that hospitals have kept their cost increases below historic levels,”
said Caroline Steinberg, the AHA’s vice president for trends analysis. “Spending on hospital care has slowed because hospitals have cut administrative expenses, better managed supply costs and streamlined patient flow.”

Spending for physician and clinical services accelerated, to 4.3% from 3.1% in 2010. Medicare spending increased 6.2%, up from 4.3% in 2010, while Medicare enrollment increased 2.5% as the first baby boomers became eligible for the program. Spending for private health insurance increased 3.8%, up from 3.4% in 2010, while outof- pocket spending increased 2.8%.

CMS said it was unclear whether the low growth in health spending represented the start of a trend or reflected the continuing effects of the recession, which slowed the economy from December 2007 to June 2009.

Health spending grew more than 5% each year from 1961 to 2007. It rose at double-digit rates in some years, including every year from 1966 to 1984 and from 1988 to 1990.

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Topic: Advocacy and Public Policy

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