Both private and public forms of medical insurance, prescription drugs, medical goods, Medicare, Medicaid and health services were affected by the weakening demand for these forms of treatment in 2016, making it clear that most Americans found the Affordable Healthcare Act not so affordable. And they told reporters they could not recall another time before previous year that spending growth had slowed for all three major payers - private health insurance, Medicare and Medicaid - and for goods and services, too.
"Over the last decade, the U.S. has experienced unique events that have affected the health care sector, including the most severe economic recession since the Great Depression, major changes to the health care system because of the ACA and historic lows in medical price inflation", said Micah Hartman, a statistician in the Office of the Actuary at CMS and lead author of a Health Affairs article on the results.
Medicaid spending growth was 3.9 percent in 2016, increasing to $565.5 billion.
Medicare spending hit $672.1 billion, accounting for 20% of total healthcare expenditures. Hospital spendingHospital spending increased 4.7%, reaching $1.1 trillion, and represented 32% of overall healthcare spending. Hospital care expenditure growth slowed from 5.7% in 2015 to 4.7% in 2016. There were mixed reasons for the slower growth in hospital spending. For major payers, Medicare spending growth was flat for the fourth consecutive year.
The increase in out-of-pocket health spending was mostly due to Americans refusing to accept and partake in Obamacare and opting to have no insurance coverage at all or go with higher deductible plans. Medicaid hospital spending also fell because of a decline in supplemental payments to hospitals. Growth in non-price factors such as the use and intensity of services increased 3.8% and accounted for most of the increase in spending in 2016, though at a slower rate than the 4.5% increase in 2015. Total expenditures in this category reached $664.9 billion, or 20% of overall healthcare spending. CMS attributes the slowdown to a wider slowdown in spending growth for retail prescription drugs, hospital care and physician and clinical services. On a per capita basis, national health spending grew at 3.5%, reaching $10,348 previous year.
Despite slower growth in health spending overall, consumers still faced the fastest rate of growth in out-of-pocket spending since 2007, with an increase of 3.9%.
On Wednesday, a federal study conducted by the Office of the Actuary at the Centers for Medicare and Medicaid Services (CMS) showed that while the overall spending for health services increased in 2016 ($3.3 trillion), the pace at which spending for healthcare slowed down drastically compared to the previous two years. Private health insurance continued to be the largest payer for healthcare goods and services in the United States in 2016-accounting for just over one-third of total healthcare spending.