Health Care Spending Growth Has Slowed: Will the Bend in the Curve Continue? /
Smith, Sheila D.
Health Care Spending Growth Has Slowed: Will the Bend in the Curve Continue? / Sheila D. Smith, Joseph P. Newhouse, Gigi A. Cuckler. - Cambridge, Mass. National Bureau of Economic Research 2022. - 1 online resource: illustrations (black and white); - NBER working paper series no. w30782 . - Working Paper Series (National Bureau of Economic Research) no. w30782. .
December 2022.
Over 2009-2019 the seemingly inexorable rise in health care's share of GDP markedly slowed, both in the US and elsewhere. To address whether this slowdown represents a reduced steady-state growth rate or just a temporary pause we specify and estimate a decomposition of health care spending growth. The post-2009 slowdown was importantly influenced by four factors. Population aging increased health care's share of GDP, but three other factors more than offset the effect of aging: a temporary income effect stemming from the Great Recession; slowing relative medical price inflation; and a possibly longer lasting slowdown in the nature of technological change to increase the rate of cost-saving innovation. Looking forward, the post-2009 moderation in the role of technological change as a driver of growth, if sustained, implies a reduction of 0.8 percentage points in health care spending growth; a sizeable decline in the context of the 2.0 percentage point differential in growth between health care spending and GDP in the 1970 to 2019 period.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Health
Health Care Spending Growth Has Slowed: Will the Bend in the Curve Continue? / Sheila D. Smith, Joseph P. Newhouse, Gigi A. Cuckler. - Cambridge, Mass. National Bureau of Economic Research 2022. - 1 online resource: illustrations (black and white); - NBER working paper series no. w30782 . - Working Paper Series (National Bureau of Economic Research) no. w30782. .
December 2022.
Over 2009-2019 the seemingly inexorable rise in health care's share of GDP markedly slowed, both in the US and elsewhere. To address whether this slowdown represents a reduced steady-state growth rate or just a temporary pause we specify and estimate a decomposition of health care spending growth. The post-2009 slowdown was importantly influenced by four factors. Population aging increased health care's share of GDP, but three other factors more than offset the effect of aging: a temporary income effect stemming from the Great Recession; slowing relative medical price inflation; and a possibly longer lasting slowdown in the nature of technological change to increase the rate of cost-saving innovation. Looking forward, the post-2009 moderation in the role of technological change as a driver of growth, if sustained, implies a reduction of 0.8 percentage points in health care spending growth; a sizeable decline in the context of the 2.0 percentage point differential in growth between health care spending and GDP in the 1970 to 2019 period.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Health