Healthcare spending growth between 2014 and 2024 is projected to be substantially lower than the 3 decades prior to 2008, according to a new report from CMS. In addition, the average premium for a basic Medicare Part D prescription plan will remain stable in 2016.
Healthcare spending growth between 2014 and 2024 is projected to be substantially lower than in previous years, according to a new report from CMS. Total healthcare spending is expected to average 5.8% over 2014 to 2024, compared with the 9% average seen in the 3 decades prior to 2008.
In 2014, healthcare spending in the US is projected to be $3.1 trillion, or $9,695 per person. This 5.5% increase over the previous year is associated with millions more gaining coverage and expensive specialty drugs coming to market. Overall, though, annual growth in per-enrollee expenditures remained slow for private health insurance (5.4%), Medicare (2.7%), and Medicaid (-0.8%).
“Growth in overall health spending remains modest even as more Americans are covered, many for the first time. Per-capita spending and medical inflation are all at historically very modest levels,” CMS Acting Administrator Andy Slavitt said in a statement. “We cannot be complacent. The task ahead for all of us is to keep people healthier while spending smarter across all categories of care delivery so that we can sustain these results.”
An article about the study has been published in Health Affairs.
CMS also released a report on the eve of the 50th anniversary of the signing of Medicare and Medicaid into law and projected that the average premium for a basic Medicare Part D prescription plan will remain stable in 2016 at $32.50 per month, according to the agency’s estimates.
“Seniors and people with disabilities are continuing to benefit from stable prescription drug premiums and a competitive and transparent marketplace for Medicare drug plans,” Mr Slavitt said. “While this is good news, we must ensure that Medicare Part D remains affordable for Medicare beneficiaries so that they can have access to the prescription drugs that they need.”
Total Part D costs per capita grew almost 11% in 2014, but growth in spending per Medicare enrollee is historically low. The growth per capita is largely driven by high-cost specialty drugs. With the continued historically low growth in per-Medicare enrollee spending, the most recent 2015 Medicare Trustees report found that the solvency of the Medicare Trust Fund remained unchanged from last year. Currently, the fund is expected to last until 2030, which is 13 years longer than the trustees reported in 2009, prior to the passage and implementation of the Affordable Care Act.
For the past 5 years the average monthly premium for a basic Medicare Part D plan has been between $30 and $32.