Health Care Spending Spikes: Why?

Recent data from the Bureau of Economic Analysis (BEA) reveals that  during the last three months of 2013, spending on health care rose at an annual rate of 5.3%. The trend continued this year, with spending climbing 6.2% on a year-over-year basis in January and 6.7% in February. Now some of Obamacare’s fiercest critics are saying “I told you so.” “We knew this was coming,” gloats Douglas Holtz-Eakin, John McCain’s former economic adviser. “The question now is whether we can hold spending down.” It’s worth recalling that Holtz-Eakin, who served as CBO director under George W. Bush, has been wrong in the past. When I debated him on the Lou Dobbs show in 2009 he insisted that the ACA would leave us with a “ton of debt.” In fact it has reduced the deficit. And in March of 2013 when testifying before the House Energy and Commerce Committee’s Subcommittee on Health Holtz-Eakin had the chutzpa to declare that “There is anecdotal evidence, of [Exchange] premiums nearing $100,000 in New York.”  This was, of course, utter nonsense. Still, the surge in spending came as a surprise. Since December of 2007, after adjusting for inflation, health care outlays have been rising by only 2.6%  “The sudden jump has led some some commentators to declare an end to the era of slower health-cost increases, which has lasted for the past several years,” observes former CBO director Peter Orszag observes.  ...
Source: Health Beat - Category: American Health Authors: Tags: beginning of 2014 Bureau of Economic Analysis final quarter of 2013 health care inflation Medicare spending spike in health care spending BEA Douglas Holt-Eakin Drew Altman Larry Levitt Peter Orszag spending slowdown spikes Source Type: blogs