Paul Levy, prominent blogger and former president and CEO of Beth Israel Deaconess Medical Center in Boston, had a few thoughts on the government’s latest figures on his blog, Not Running a Hospital.
“As we saw in Massachusetts when universal access was provided, if you give people health insurance, they will use it,” he wrote. People are seeking medical care sooner when they have symptoms, others are getting preventive care and detecting serious illnesses and conditions earlier on, and those who require more extensive care are seeking such instead of deferring care and ending up in a hospital emergency department, said Mr. Levy.
When thought of this way, it’s difficult — or unethical — to see increased healthcare spending as a bad thing. “Without the full course of treatment they are now getting as insured patients, we would have ‘saved’ a lot of money in treatment. Some, though, would have died prematurely or suffered from extended morbidity,” wrote Mr. Levy.
2. Others are accusing the administration of changing its tune. There seems to be two different, even conflicting, messages coming from government officials. A spokesperson for the White House said the spending increase, or increase in utilization, “is neither a surprise, nor a cause for concern.” But so much of the healthcare reform law’s ultimate goal was to reduce the cost curve of the American healthcare system. The White House has said so itself: a major goal of the healthcare reform law is to “bend the growth curve of healthcare spending.”
This isn’t the first time Americans have picked up an inconsistent narrative from the White House, as President Obama previously promised voters, “If you like your healthcare plan, you’ll be able to keep your healthcare plan.” Then, last fall, some Americans received cancellation notices from their health insurers.
3. The healthcare reform law isn’t the only reason for the increase. Expenses for healthcare rose at a 5.6 percent annual rate in the fourth quarter of 2013, the fastest pace in 10 years. At the same time spending picked up in 2013, before the exchanges started, Gallup reported an increase in the number of people without insurance. These conflicting ideas suggest the spending increase was driven by people who already had coverage using more care, rather than people gaining coverage driving spending.
The other factor at play is the economy. The recession and its sluggish recovery left many unemployed Americans without health insurance and limited health spending. Since late 2011, employers added 2.6 million jobs, and the unemployment rate fell from 8.5 percent to 6.7 percent. It is unclear, however, how many of these added jobs offer employer-sponsored health insurance.
4. The trend raises bigger questions. Such as, are Americans any healthier? The White House attributed the spending increase to more healthcare utilization, but that is not a complete answer. There are the tricky subcategories of valuable utilization and unnecessary utilization. Is this level of spending driven by people seeking necessary care they previously postponed due to lack of coverage, or unnecessary care out of eagerness that they gained coverage and can now access physicians?
Another question: How long will increased spending — or, according to the White House, increased demand — last?
