The Evidence on Recent Health Care Spending Growth and the Impact of the Affordable Care Act

Brief

The Evidence on Recent Health Care Spending Growth and the Impact of the Affordable Care Act

Abstract

National health expenditures have been growing in recent years at about the rate of increase in gross domestic product (GDP) plus 1 percent, following decades of growth at GDP plus 2.5 percent. In this brief the authors discuss a number of reasons for the slowdown, including contributions made by the ACA. The authors also discuss reasons for the growth in marketplace premiums, finding that states with rapid growth rates typically have little insurer or provider competition. Large numbers of states have seen relatively modest premium increases. Finally, the authors conclude with evidence on Medicaid spending growth, arguing that enrollment increases have played a major role, with growth in spending per enrollee below that of other payers. This largely reflects the cost containment efforts of states.

Research Area: 

Centers

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