U.S. healthcare spending growth hasn't been this slow in 50 years, but many industry experts expect spending to pick up in the near future because of economic recovery since the recession, according to the Financial Times.
Healthcare spending grew 3.6 percent in 2013, the lowest rate of increase since 1960 and the fifth consecutive year of less than anticipated growth. The inflation in healthcare prices is also at its lowest point since the 1960s with an annual rate of just 0.5 percent in January, according to the report.
Industry experts' explanations for the spending slowdown vary, and some possess opposing views on whether spending will pick up or continue in its current pace.
1. Some experts attribute lower spending to effects of the recession. While President Barack Obama's administration and proponents of the Patient Protection and Affordable Care Act have repeatedly pointed to reduced healthcare spending as a product of the healthcare reform law, some argue that the deceleration in spending is largely due to the recession of the U.S. economy between 2007 and 2009, not industry discipline or reform. A drop in healthcare spending may take up to six years to be fully realized, as providers and individuals adjust to broader changes in the economic landscape that may influence how much they utilize available healthcare services, according to the report.
2. Several factors could lead to increased spending in the coming years. If the economy continues on its path to recovery, healthcare spending could continue to rise — national healthcare spending rose 5 percent last year, according to the Altarum Institute research group. Other factors such as the emergence of popular and expensive drugs, as well as the increased hiring and wages in the industry could lead to increased spending.
3. Structural changes could help keep healthcare spending at lower rates. Despite the factors named above, various structural changes to the national healthcare system could continue to slow down healthcare spending even as economic recovery continues to build, such as the shift to value-based reimbursement models and high co-pays and deductibles for consumers, according to the report. On an individual level, increased out-of-pocket costs for patients should impose discipline on their spending, although this will also require increased transparency in prices that allow them to shop around for the best deal.