News | September 05, 2014

Number of Uninsured to Decrease, Faster Health Expenditure Growth Expected

CMS says growth likely as coverage expands and economy improves

September 5, 2014 — The number of uninsured is expected to decline by nearly half from 45 million in 2012 to 23 million by 2023 as a result of the coverage expansions associated with the Affordable Care Act (ACA), according to a report from the Centers for Medicare & Medicaid Services (CMS) Office of the Actuary. The report is published in Health Affairs.

“Healthcare costs are increasing at a slower rate thanks to the Affordable Care Act,” said Marilyn Tavenner, CMS administrator. “The dramatic decrease in the number of uninsured Americans is a win for our country and its economy in the future.”

Health spending growth for 2013 is projected to remain slow at 3.6 percent, which would mark the fifth consecutive year of spending growth under 4 percent. National health expenditures (NHE) are projected to grow at an average rate of 5.7 percent for 2013 through 2023, about 1.1 percentage points faster than the expected average annual growth rate for the gross domestic product (GDP).

Average annual growth of 6 percent per year is projected for 2015 through 2023, largely as a result of the continued implementation of the ACA coverage expansions, faster projected economic growth and the aging of the population. While projected growth over the projection period is faster compared to recent experience, it is still slower than the growth observed over the last two decades. From 1990 to 2008, the average rate was 7.2 percent and health spending grew 2 percentage points faster than the GDP.

The National Health Expenditure projections report, issued annually, contains estimates of spending for healthcare in the United States over the next decade by type of service and source of funding.

Other findings:

  • 2014 Spending Growth Expected to Accelerate. For 2014, the health spending growth rate is expected to be 5.6 percent, as 9 million Americans are projected to gain health insurance coverage, predominantly through Medicaid or the health insurance marketplace. Out-of-pocket spending is projected to decline by 0.2 percent.
  • Government Health Expenditures Expected to Increase. By 2023, health expenditures financed by federal, state and local governments are projected to account for 48 percent of national health spending. In 2012, such expenditures constituted 44 percent of national health spending.


For more information: http://content.healthaffairs.org/lookup/doi/10.1377/hlthaff.2014.0560

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