Care spending growth slowed considerably in 2016

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The overall slowdown was highlighted by the National Health Expenditure report issued by the federal Centers for Medicare and Medicaid Services' Office of the Actuary. Dating back to 1960, the NHEA measures annual US expenditures for health care goods and services, public health activities, government administration, the net cost of health insurance, and investment related to health care.

In an online report and a media conference call, CMS attributed faster spending growth in 2014 and 2015 to the implementation of the federal Affordable Care Act and its related Medicaid expansion, which together extended health insurance to almost 19 million people.

Health care spending rose 4.3 percent previous year to $3.3 trillion after a 5.8 percent increase in 2015.

Healthcare spending in the United States grew by 4.3% to $3.3 trillion, or $10,348 per person, and represented almost 18% of the national economy in 2016, federal actuaries report.

For private health insurance and Medicaid, the slower growth was influenced by decelerated enrollment growth, while Medicare spending slowed because of lower enrollment increases due to defections to Medicare Advantage plans. "This includes Medicaid, private health insurance, and Medicare, as well as retail prescription drugs, hospital care, and physician and clinical services".

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Check out the full statistics on the CMS website.

Changes in the age and gender mix of the population accounted for 0.6 percent of the growth.

But because health spending grew faster, as it has for years, than overall gross domestic product, health spending's share of the economy increased to 17.9 percent in 2016, up from 17.7 percent of the economy the year before. Increases in medical prices accounted for 1.4 percent, while growth in the use and intensity of healthcare goods and services accounted for the remaining 1.6 percent. And they told reporters they could not recall another time before a year ago that spending growth had slowed for all three major payers - private health insurance, Medicare and Medicaid - and for goods and services, too.

Physician and clinical services spending rose by 5.4 percent, slowing from a growth rate of 5.9 percent in 2015. The deceleration was largely driven by slower enrollment growth in 2016 after two years of faster enrollment growth due to ACA coverage expansion. The notable slowdown in private health insurance spending was mainly driven by slower enrollment growth, slower growth in spending for retail prescription drugs, and a continued shift to high-deductible plans.

The 8.2% spending growth for clinical services almost doubled the 4.6% growth in spending for physician services for the twelfth consecutive year.

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Spending rose more slowly in 2016 than during the prior two years, when the Affordable Care Act's coverage expansion was underway, the uninsured rate was falling to its lowest-ever level and more people were gaining access to medical care.

The National Health Expenditure Accounts (NHEA) are the official estimates of total health care spending in the United States. Total expenditures in this category reached $664.9 billion, or 20% of overall healthcare spending.

On a per enrollee basis, private health insurance spending increased 5.1 percent in 2016, about the same as the 5 percent in 2015.

Out-of-pocket spending increased 3.9 percent last year ― the biggest annual growth in nine years, the Office of the Actuary reports.

Private health insurance continued to be the largest payer for health care goods and services in the U.S.in 2016, accounting for just over one-third of total healthcare spending. Republicans in Congress have tried unsuccessfully to cap federal Medicaid spending to states to help control growth in the program, an effort opposed by Democrats and advocates for the poor. Last year, 22 new medicines were approved, compared with 45 in 2015 and 41 in 2014. Medicare spending rose 3.6% to $672.1 billion, down from 4.8% growth in 2015, accounting for 20% of total healthcare expenditures.

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