Why was there a slowdown in Medicare spending progress over the previous decade? – Healthcare Economist

That’s the query posed by Buntin et al. (2022). The authors used information from the 2007-2018 Medicare Grasp Beneficiary Abstract File after which ran a regression adjustment to manage for affected person demographics (i.e., age, intercourse), variety of power circumstances (none, 1-3, ≥4), and whether or not the person had Half A or Elements A and B protection.

Utilizing this strategy the authors discovered that:

Between 2008 to 2011 and 2012 to 2015, the adjusted annual Medicare Elements A and B per-beneficiary spending progress price declined from 3.3% to −0.1%. From 2016 to 2018, the imply annual Medicare spending progress price rose relative to the earlier interval however remained decrease than within the baseline interval at 1.7% per yr. This slowdown prolonged throughout all sectors inside Elements A and B, apart from physician-administered medication supplied beneath Half B. Adjustments in fee charges (together with sequestration measures) and beneficiary traits defined 44% of the distinction in general per-beneficiary spending progress between 2007 to 2011 and 2012 to 2015, and 63% between 2007 to 2011 and 2016 to 2018.

The authors discover that almost all fee charges tracked pretty near inflation (21.0% over this time interval), however doctor reimbursement solely elevated by 6.5%.

The authors observe that their findings are per the Congressional Price range Workplace’s discovering that general extra price progress—or per capita spending progress above and past per capita GDP progress —in Medicare between 2005 and 2017 was −0.1%. In different phrases, Medicare spending was 0.1 proportion factors decrease than financial progress over this time interval.