CMS released a report Wednesday in the journal Health Affairs that showed healthcare spending continued to grow in the US last year, and now constitutes 17.3% of the country's GDP. Most major newspapers covered the story. The Washington Post (2/4, A7, Brown) reports, "Healthcare spending in the United States grew last year despite a contracting economy," according to the CMS numbers. The 1.1% increase "in 2009 compared with 2008" is "the largest one-year increase since at least 1960." The government estimates that by 2019, "healthcare spending will be $2 trillion higher than it is now, it will represent 19.3 percent of the economy, and the government will pay 52 percent of it."
The Wall Street Journal (2/4, A1, Landers, subscription required) reports on its front page that in 2011 government programs are predicted to take up more than half of the country's healthcare spending.
The Los Angeles Times (2/4, Levey) calls the report "a stark reminder of growing costs." But, the increases, "driven in part by surging spending in Medicare and Medicaid, and the bleak projections for the future do not take into account changes that may come if Democrats revive their healthcare overhaul legislation."
For 2009, the New York Times (2/4, A18, Pear) explains, "A major factor in the growth of health spending was the increase in Medicaid enrollment and Medicaid spending as a result of rising unemployment. As people lost jobs, they lost private insurance, and many turned to Medicaid."
Christopher Truffer of Medicare's Office of the Actuary, who authored the report, noted "This is certainly a very steep rate of growth," USA Today (2/4, Fritze) reports. The figures are "the latest indication of the nation's mounting medical expenses and it comes as Congress has stalled on President Obama's proposal to revamp the healthcare system."
The AP (2/4, Alonso-Zaldivar) calls the report "a reality check in the debate over Obama's healthcare plan, which has been dominated by disagreements over how large a role government should play." CMS' Chief Actuary Richard Foster "said the recession has only worsened the two stubborn problems facing the US healthcare system: lack of insurance coverage and high costs." He said, "All that argues that some form of healthcare reform is a good idea."
Bloomberg News (2/4, Thomas) reports that, according to CMS, "Outlays by Medicare...will expand at an average annual pace of 6.9 percent" from 2009 through 2019, "after jumping 8.1 percent in 2009 to $507.1 billion." The report also found that "all US spending on prescription drugs rose an estimated 5.2 percent last year to $246.3 billion, fueled by the new swine-flu outbreak, higher drug use, and higher prices for brand-name medicines as opposed to cheaper generics." The Hill (2/4, Young, subscription required), Kaiser Health News (2/4, Weaver), and Reuters (2/4, Smith) also cover the story.
Increasing health spending will starve other sectors of society, columnist writes. In his Washington Post (2/4, A17) column, George Will writes that Nobel Prize-winning economist Robert Fogel warned last September that "spending on healthcare is going to surge, for two reasons: By living longer, Americans will become susceptible to more health problems. By becoming richer they will be able to purchase more biotechnologies that make health interventions more effective." Will says, that might mean "starving every other sector of society." Fogel also says that by 2040, China's "40 percent share of global GDP will be almost triple that of the United States' 14 percent" because "while China increasingly invests in its future, America increasingly invests in its past: the elderly."
