Report: Health Care Spending At Record Low

| by Edward Arnold

In 2013, spending on health care in the United States grew at the lowest rate ever recorded.

A study done by the Center for Medicare and Medicaid Service, published in Health Affairs, found that health spending totaled $2.9 trillion last year, up 3.6% from 2012. Overall, health spending grew at about the same rate as the economy.

Premiums for private insurance grew just 2.8 percent last year, compared to 4 percent in 2012. Nearly 190 million people were covered by private health insurance in 2012. 

Here, courtesy of the Centers for Medicaid and Medicare, is a graph showing last year's record-low growth in health care spending:

Spending for physician and clinical services grew 3.8 percent in 2013, an improvement from 4.5 percent in 2012. Drug costs, however, rose at a faster rate in 2013, 2 percent more than in 2012.

President Obama, during the business round table conference, noted that “premiums have gone up at the lowest pace on record, which means that a lot of the business here are saving money, as are a lot of consumers.”

The question on everyone's mind, however, is whether or not these positive effects are due to economic recovery or the Affordable Care Act. The report noted that the answer to that question will be answered if health spending growth accelerates once economic conditions improve significantly.

Marilyn B. Tavenner, administrator for the Centers of Medicare and Medicaid Services, said the report was “another piece of evidence that our efforts to reform the health care delivery system are working."

Source: New York Times, CNN Money / Photo Credit: Images Money, Flickr Creative Commons