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We Still Have A Health-Care Spending Problem


What:  With every new report about the recent slowdown in health-care spending there is speculation in the media that the problem of rising health costs has somehow been solved or cut down to size. The idea that we have licked the problem of health-care cost increases is no more probable today than it was in the past. Our nation has made no fundamental change in how health care is paid for or delivered.

Congress has not passed sweeping legislation to contain health costs, although it did make inroads into moderating the growth in Medicare and health-insurance premiums through the Affordable Care Act (or Obamacare, as it is sometimes known). Increases in Medicare payments to insurance companies, hospitals and other health-care providers are getting trimmed. And the law is fostering a number of small-scale experiments around the country that are showing promise in delivering health care more efficiently. Big increases in insurance premiums for individuals and small businesses are now scrutinized by federal and state officials, and insurers are required to provide rebates if their administrative overhead and profits are too high.

Why: The jury is still out on this. Although there is much debate on whether or not the Affordable Care Act has affected health care costs, the reality is that little of it has been implemented yet and it can take years see the effects of such legislation.

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