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Maggie Mahar commented on the blog post The Roundup for August 17, 2011
Paupau–
Yes, GDP is growth is much slower than in the past.
But that doesn’t have anything to do with the fact that Medicare
spending is slowing. (GDP growth doesn’t drive healht care spending.
Infation (CPI) doesno’t drive health care spending.The rising cost of drugs, devices,doctors and hospitals and rising
utlilization of all of the above drives health care spending.If you read the post, you’ll note that I say that we can’t expect GDP growth to be more than 1% to 2% over the next two years. So that means we need to get Medicare spending down to, say, 2%. According to the S&P index, it’s already down to 2.6% annualized, over the past 18 months. According to CBO it’s around 3.5%. In other words, we’re getting close . ..and the reforms that will cut Medicare spending (cutting overpayments to Advantage insurers and shaving 1% off updates (annual increases) to institutional providers by 1% a year for 10 years could bring Medicare spending growth down to 2%.
What matters is how fast Medicare spending is growing compared to GDP.
The Affordable Care ACt calls on hospitals to reduce preventable errors, reduce preventable readmissions, and reduce unncessary tests and procedures so that they can provide better care for less.
Many hospitals have already cut back on diagnostic imaging, and many are
engaged in improving systems to avoid errors. Many financial carrots and sticks in the ACA. If you the legislation, you’ll be surprised by the many
ways it will cut waste in Medicare, without ratining care, cutting benefits, or cutting doctors’ fees. -
Maggie Mahar commented on the blog post The Roundup for August 17, 2011
David–
Thanks for mentioning the deceleration of Medicare spending.
But it’s not one report. Actually reports show Medicare spending slowing: CBO,the Treasury Dept. report on government outlays, and the S&P Medicare index.
Zeke provides an opinion as to why it’s happpening.
But the dramatic slow-down (over 18 months) is a fact. You can see the numbers in any of the three reports.Finally,Zeke did not say that this was a result of the Affordable Care ACt kicking in because the part of the ACA that would rein Medicare spending does not kick in until 2014. Zeke suggested that hospitals are anticipating the ACA kicking in,and so are cutting their costs now.
When the ACA kicks in and Medicare begins cutting overpayments to private Advantage insurers, and trimming annual increases to hospitals and nursing homes by 1% a year for 10 years–we should see further slowing.
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Maggie Mahar commented on the blog post The Roundup for August 17, 2011
bmull–
An assertion without evidence is not very persuasive.
The post provides abundant data. See http://www.healthbeatblog.com/2011/08/medicare-spending-slows-sharply-few-seem-to-notice-part-1.html
