Health spending expected to continue outpacing inflation

A  study from government actuaries published this week projects that total health spending in the U.S. will increase by 6.2 percent a year over the next decade (Source: “Health Spending Over The Coming Decade Expected To Exceed Economic Growth,” Kaiser Health News, Sept. 18, 2013)/

The estimates by the CMS Office of the Actuary, which were published in the journal Health Affairs, are lower than typical annual increases before the recession hit. Still, the actuaries forecast that in a decade, the health care segment of the nation’s economy will amount to a fifth of the gross domestic product in 2022. 

The actuaries attributed the projected increase to the rising number of baby boomers moving into Medicare and the expectation that the economy will improve. The actuaries were not persuaded that experiments in the health law and new insurer procedures that change the way doctors, hospitals and others provide services will significantly curtail health spending. They assumed "modest" savings from those changes from the law. "It's a little early to tell how substantial those savings will be in the longer term," said Gigi Cuckler, one of the actuaries who authored the report.