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  • Health Spending Down—Because People Are Avoiding Care

    The Office of the Actuary at the Centers for Medicare and Medicaid Services (CMS) recently published its annual estimate of U.S. health spending in the journal Health Affairs. The report shows that growth in health spending remained slow in 2010. Medical expenditures grew at an annual rate of 3.9 percent, up just 0.1 percent from 2009. However, the slow growth doesn’t represent a decrease in health care costs, but a reduction in utilization and intensity of medicine. People are choosing the less costly alternative of avoiding the doctor and not taking expensive prescription drugs.

    The report primarily attributes the slow growth to effects of the recent recession:

    Including the highest unemployment rate in twenty-seven years, a substantial loss of private health insurance coverage, employers’ increased caution about hiring and investing during the recovery, and the lowest median inflation adjusted household income since 1996.

    Despite CMS’s and other health economists’ conclusion that the recession led to slow health spending growth, the Obama Administration published a blog stating that Obamacare is responsible, with no mention of the recession. Nancy-Ann DeParle, Assistant to the President and Deputy Chief of Staff, wrote that “(These numbers) do show why the Affordable Care Act is so important. And we’re confident the law will continue to help hold down cost growth in the years ahead.”

    But with only a few provisions of Obamacare enacted, CMS found its effects to be minimal, with a projected net impact on health spending of less than 0.1 percentage point.

    Quoted by The Wall Street Journal, Douglas Holtz-Eakin said it best: The Obama Administration “really can’t claim any credit unless it’s to say, ‘We broke the economy and you can thank us for that.’ ”

    However, one portion of health spending has substantially grown, and that’s the federal government’s share of the spending. According to the CMS report, the government’s percentage of spending has risen to 29 percent, an increase from 23 percent in 2007. The report explains that the increase is due to “Medicaid enrollment increasing rapidly and the federal government paying a higher share of Medicaid benefits through enhanced federal matching rates, as mandated by the Recovery Act.”

    As the federal government spends more money on health care, it gains more power in our health care system. Government control places a bigger tax burden on the American people while reducing taxpayers’ freedom to choose their own health care. Government control and the weight on taxpayers are only expected to rise further with the most costly provisions of Obamacare, such as Medicaid expansion and exchange subsidies, taking effect in 2014.

    To avoid Obamacare’s inevitable increase of government control over health care and the increased burden it puts on taxpayers, it must be repealed. For ideas about health care reform that works, read Heritage’s Saving the American Dream.

    Posted in Obamacare [slideshow_deploy]

    7 Responses to Health Spending Down—Because People Are Avoiding Care

    1. Bobbie says:

      It also has to do with trust and the care. It's not worth the cost…

      just recently they stated how the morality in cancer patients has increased. how can a person believe that when personally known two out of two people have passed in the last two1/2 years because. Then you have Tony Blankley, Steve Jobs, etc. there was mention of Alzheimer symptoms found in women 40 +. and here prescription pills "statins" are found to effect the mind and muscles! the next result will be younger arthritis patients! I've witnessed some horrific things in the last four years regarding health care in someone elses paid hands from doctor clinics to hospitals to transitional care facilities! It's terrible! The private sector has personable respect and an honorable goal to heal…or had?

    2. Star says:

      First they want us to "take charge" of our care–which means going on a low-cal diet for the hundredth time if they tell you to. If you take charge by saying no statins, my sister had the leg pains and I don't want an increased change of diabetes–you are noncompliant, never darken this door again. If you won't take a blood thinner because you had two bleeds on it, one of which cost sight in one eye (complicated by 4 bad surgeries), then OK–you're getting a stroke then. I try to stay away now–but they have noticed this and won't give you the prescriptions you do agree to unless you come in. It's a battle!

    3. Kat W says:

      Sure, spending is down because people are avoiding care. See this quick article from the American Action Forum explaining that, when people have less money to spend, they spend less on health care. http://americanactionforum.org/topic/obama’…. It makes sense.

    4. Obamacare doesn’t represent a decrease in health care costs, but a reduction in utilization and intensity of medicine. People are choosing the less costly alternative of avoiding the doctor and not taking expensive prescription drugs. In other words, IT'S NOT EFFECTIVE AND HASN'T DONE ANYTHING TO IMPROVE THE OVERALL HEALTHCARE INDUSTRY!

    5. Mike, Wichita Falls says:

      Is the repeal of Obamacare the number one domestic issue of this campaign? I think so as it is a big factor in long-term economic recovery. All of the contenders vow to repeal it, but who do you really think has the political will to do it? Unless the Supreme Court strikes down the whole law down to the last dotted i and crossed t, the political branches must finish it off. I was confident in only one person to do so until she dropped out of the race. Again, of the remaining contenders, who really means what they say on Obamacare, and who will be a go-along-to-get-along guy?

    6. saveamerica says:

      Not sure if it's mandated through government regulations but an extremely reckless, inefficient act is supplying 3 months of doses when there are side effects! 3 months paid for, now have to be thrown out and replaced by another 3 month supply with the same but worded different, side effects! lots of wasted money from the purchaser and lots of thrown out prescription pills the government calls toxic to the environment and lots of suspicion on the goal they're looking to reach! I'd rather deal with high cholesterol than take a pill that compromises my mind and muscles just to keep my cholesterol in the government supported, AMA speculated range. My mother died of a massive heart attack when she stopped taking the cholesterol pills that made her physically ill.

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