National Health Expenditures Continued Slow Growth in 2013

Health spending continued to grow at a slow rate last year the Office of the Actuary (OACT) at the Centers for Medicare & Medicaid Services (CMS) reported today. In 2013, health spending grew at 3.6 percent and total national health expenditures in the United States reached $2.9 trillion, or $9,255 per person. The annual OACT report showed health spending continued a pattern of low growth—between 3.6 percent and 4.1– percent for five consecutive years.

The recent low rates of national health spending growth coincide with modest growth in Gross Domestic Product (GDP), which averaged 3.9 percent per year since the end of the severe economic recession in 2010. As a result, the share of the economy devoted to health remained unchanged over this period at 17.4 percent.

“This report is another piece of evidence that our efforts to reform the health care delivery system are working,” said CMS Administrator Marilyn Tavenner. “To keep this momentum going, we are continuing our efforts to shift toward paying for care in ways that reward providers who achieve better outcomes and lower costs.”

Total national health spending slowed from 4.1 percent growth in 2012 to 3.6 percent in 2013.  The report attributes the 0.5 percentage point slowdown in health care spending growth to slower growth in private health insurance, Medicare, and investment in medical structures and equipment spending. However, faster growth in Medicaid spending helped to partially offset the slowdown.

Other findings from the report:

Since 2010, the share of health spending financed by the federal government decreased—from 28 percent to 26 percent in 2013. At the same time, the share financed by state and local governments increased—from 16 percent in 2010 to 17 percent in 2013. These shifts resulted primarily from the June 2011 expiration of additional Medicaid funding provided by the federal government to the states through the American Recovery and Reinvestment Act of 2009.

The report includes all of the net impacts of the Affordable Care Act provisions as well as the budget sequester through 2013.  The Affordable Care Act provisions that exerted downward pressure in 2013 were:

The Affordable Care Act provisions that exerted upward pressure in 2013 included:

The OACT report is available here:

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