Health Spending Expected To Level Off For Decade After Pandemic Highs
Axios and The Wall Street Journal report on new expectations for U.S. health care spending after covid prompted soaring figures. For the rest of the decade, spending is likely to level out, only growing at inflationary rates. Meanwhile, reports say hospitals remain at an operating loss after omicron.
Axios:
New Normal For Health Care Spending
U.S. health care spending is likely to grow at about the rate of inflation over the rest of the decade after the pandemic fueled a nearly 10% jump between 2019 and 2020, federal experts said Monday. The CMS actuaries' projections in Health Affairs came with plenty of caveats. But if trends hold, out-of-pocket spending is going up, as is spending on private coverage, Medicare and Medicaid. "This outlook is contingent on a virus that has evolved and surprised at every turn — and could do so again," the authors wrote. (Reed, 3/29)
The Wall Street Journal:
U.S. Healthcare Spending Growth Slowed In 2021 After Covid-19 Surge
U.S. healthcare spending growth is expected to have slowed last year after reaching a nearly two-decade high driven by the pandemic, according to a new report by federal regulators. National health spending is projected to have grown 4.2% to $4.3 trillion in 2021, compared with a growth surge of 9.7% in 2020, according to the report from actuaries at the Centers for Medicare and Medicaid Services. The slowdown came from a decline in the use of healthcare services and federal financial stimulus as Covid-19 cases fell amid a pandemic that has led to nearly 975,000 deaths and almost 80 million cases in the U.S. (Armour, 3/28)
In related news —
Modern Healthcare:
Hospitals Remain At An Operating Loss Following Omicron Surge
Hospitals saw a median operating margin decline of 11.8% between January and February, as healthcare providers dealt with lower inpatient and outpatient volumes, higher resource costs and the omicron surge's effects. COVID-19 cases and hospitalizations subsided in February, and hospitals experienced fewer, but more costly expenses due to the nationwide labor shortage and supply chain challenges, according to healthcare consultancy Kaufman Hall, which reports monthly on the finances of more than 900 mostly not-for-profit hospitals. (Devereaux, 3/28)
Modern Healthcare:
CMS: Healthcare Prices Projected To Rise 3.6% In 2022
Healthcare prices are expected to rise this year, driving up out-of-pocket expenses, the Centers for Medicare and Medicaid Services' Office of the Actuary said Monday. Price growth will fuel healthcare spending inflation in 2022, stemming from providers' higher labor and supplies costs, according to a report in Health Affairs released Monday. Prices are expected to rise by 3.6% in 2022 and boost overall healthcare spending growth 4.6% to $4.5 trillion. Prices grew 2.7% in 2021, 3.1% in 2020 and 1.1% in 2019. As a result, out-of-pocket costs are projected to climb 6.1% in 2022 and an average of 4.6% from 2021 to 2030. (Kacik, 3/28)
In other health care industry news —
Axios:
Health Workforce Shortages Begin To Weigh On Patient Safety
The COVID-19 pandemic and the strain it has put on healthcare workforces is threatening patient care. Years of progress reducing medical errors and preventable hospital-acquired infections were reversed in medical centers and skilled nursing facilities during the pandemic. But ongoing health care workforce disruptions — including early retirements, nurses shifting to travel positions and increased workloads for those who remain — threaten hospitals' ability to get back on track. (Reed, 3/28)
Modern Healthcare:
Feds Join Lawsuit Against EHR Vendor ModMed
The federal government will intervene in a False Claims Act lawsuit against electronic health records vendor Modernizing Medicine and its co-founders that became public Friday. The lawsuit alleges the company falsely attested to complying with certification requirements for its EHR products, provided illegal kickbacks to doctors and upcoded diagnoses entered into its EHRs. The Justice Department notified the U.S. District Court for the District of Vermont that it will partially intervene in the case and intends to file its own complaint within 90 days. (Goldman, 3/25)
Indianapolis Star:
2 Black-Owned Health Care Centers Open In Indianapolis
TaQuita Taylor did not set out to break any barriers when she decided to open a pediatric urgent care clinic. The family nurse practitioner has a business planning spa parties, or sparties, for young girls but then had another idea that called to her — opening a pediatric urgent care clinic. And her conviction that she made the right decision in opening Children Express Care Clinic, grew even stronger when she learned that northeast side clinic is the first Black-owned urgent care site in the state. (Rudavsky, 3/29)
