Have Humans Evolved to Be Cheaters? Nadia Nooreyezdan. The Swaddle, Mar 10, 2019. https://theswaddle.com/have-humans-evolved-to-be-cheaters/
Excerpts (full text with lots of links at the reference above):
[...] Evolutionary psychology experts like Christopher Ryan and Cacilda Jethá, co-authors of the book Sex at Dawn, theorize men and women both have biological motivations for cheating while maintaining a monogamous relationship. Male animals, including humans, have an evolutionary drive to have as many offspring as they can with different mates, while females are motivated to seek out mates with superior genes in order to increase the genetic diversity (and chances of survival) of their offspring. But some animals, humans included, have also evolved, both socially and biologically, to want the security of monogamous relationships; we may still feel jealousy or betrayal if we’re cheated on, wanting our partners to be faithful, while also being sexually attracted to other people.
While this isn’t an excuse for people to cheat, it does suggest humans will always have these opposing biological motivations creating a tension within ourselves and our relationships.
Monogamy is uncommon among animals, with fewer than 5 percent of mammals staying with the same mate. Humans evolved towards monogamy mostly because babies are, in a word, helpless. [...]
Because they needed to be nursed, carried, protected, and fed for several months, if not years, pairs or groups of parents raising the infant became necessary, Ryan and Jethá write. But since male primates didn’t like to be responsible for offspring that wasn’t theirs (an understatement — this usually resulted in infanticide by angry males), pair-bonding became a necessity. Monogamous pairs seemed to be the solution for decreasing male-male competition while still ensuring enough resources for the offspring. But this didn’t mean that primitive man didn’t cheat.
Monogamy was a convenient way to ensure that, in the genetic competition of evolution, one’s offspring reached maturity. It meant staying together basically ‘for the sake of the kids,’ but not necessarily being sexually faithful to one another. Our motivations for reproduction, Ryan and Jethá argue, drive us to seek partners outside of our monogamous relationships.
Reproduction required little investment for males; females, on the other hand, have to choose between the security a male partner may provide, and superior genetic qualities — because as Daniel Kruger, an evolutionary psychologist at the University of Michigan, has pointed out, it’s rare for a man to provide both.
“One long-term strategy is to settle down and have a long-term relationship with a guy who’s a reliable, stable provider, but then have an affair on the side with a guy who has phenotypic qualities and can provide that high-quality genetic investment,” Kruger has said. And genetically, women are predisposed to have this kind of ‘back-up plan,’ which researchers at the University of Texas refer to as the “mate-switching hypothesis.” But in order to maintain the status quo of the monogamous relationship, both men and women have to resort to what Kruger refers to as “strategies and counter strategies.” In other words, humans just try to not get caught.
Not convinced? These same competing impulses are found throughout nature, even among the animal kingdom’s erstwhile paragons of monogamy: birds.
With an estimated 90 percent of feathered species staying monogamous, birds have also been found to be serial cheaters for the same evolutionary incentives humans have. For decades, scientists believed that birds’ social monogamy during breeding season meant that the bonded pairs were prone to loyalty. But further genetic and behavioral research has shown that up to 75 percent of the offspring in a population could be from “extra-pair copulations.” Adultery, jealousy, and cuckolded partners abound, from indigo buntings, to yellow warblers. Even wandering albatrosses, who return back to the same partner every year after months at sea, aren’t always sexually faithful, with 14 to 24 percent of chicks fathered by a male who is not the mother’s life partner. Clearly, social monogamy for birds is strictly separate from sexual monogamy, a far rarer occurrence.
Regardless of species, it seems that cheating while monogamous is possibly the most ideal situation for bonded pairs. The male gets to spread his genes as far and as wide as he can, with next to no repercussions, thus ensuring reproduction with at least one female; and the female gets to increase the genetic diversity among her offspring (in case some have genetic defects, others can survive) without risking the loss of resources provided by her mate. Ideally, males will help provide for all of the female’s offspring (unaware that they might not all be his), and females will be ignorant of their male partners’ mating with others.
It could be great, if we could all be open about this and okay with the idea of raising children regardless of whether they’re biologically ours. However, child rearing à la Plato’s idea of collective parenting feels like an unattainable dream. Like so many things about humans, we must manage conflicting impulses — genetic incentives to stay in monogamous relationships, and ones that lead us to cheat.
In her recent book, The State of Affairs: Rethinking Infidelity, couples’ therapist Esther Perel argues that being honest about our desires is [...].
Sunday, March 10, 2019
Bad data, bad decisions... 9 years later after Obamacare, Centers for Medicare and Medicaid Services' actuaries find that CBO numbers were wildly off
9 Years After Obamacare Passed, Agency Finds Numbers Were Wildly Off. Jarrett Stepman. The Daily Signal, Feb 22, 2019. https://www.dailysignal.com/2019/02/22/9-years-after-obamacare-passed-agency-finds-numbers-were-wildly-off
Democrats defeated Republicans in the Obamacare repeal fight by warning that 22 million Americans would be thrown off their health insurance. They pointed to data leaked from the Congressional Budget Office.
Well, it turns out that data was completely wrong.
According to a report [a paywalled paper, https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2018.05499] by the Centers for Medicare and Medicaid Services released Wednesday, the Congressional Budget Office wildly overestimated the number of people who would lose their health insurance with the repeal of the individual mandate penalty.
Initial estimates from the Congressional Budget Office said 14 million would drop off their health insurance coverage due to the elimination of the individual mandate. Then, during the height of the 2017 debate over repeal, progressives touted a leaked number from the Congressional Budget Office claiming that 22 million people would “lose” their insurance if Congress repealed the law.
However, as health care analyst Avik Roy pointed out (https://www.forbes.com/sites/theapothecary/2017/07/22/cbo-three-fourths-of-coverage-difference-between-obamacare-gop-bills-driven-by-individual-mandate/#320be2c63627
), what made this number so high was the inflated number of people expected to lose their insurance due to repeal of the mandate—about 73 percent to be exact. So, it wouldn’t be 22 million Americans losing their insurance. Most of those in the projection would simply be choosing to opt out of insurance.
And it turns out even that wasn’t true. A far smaller number of Americans appear to be opting out of insurance since the individual mandate’s repeal. Only 2.5 million more people are expected to go without insurance in 2019 due to its repeal, according to the latest report, and that number is expected to decline in the years ahead.
[...]
The Congressional Budget Office is opaque, to say the least. It does not publish or share the way it comes up with numbers, and some have criticized the organization for its lack of transparency and outsized influence on policymaking.
Doug Badger, a visiting fellow in domestic policy studies at The Heritage Foundation, told The Daily Signal that Congressional Budget Office analysis has been a chronic problem.
“When it comes to the individual mandate, CBO has never let the facts affect their wildly inaccurate estimates. CBO continued to forecast that millions of insured Americans would suddenly become uninsured if the mandate were repealed,” Badger wrote in an email to The Daily Signal. “CBO’s faulty estimates misled the public into believing that repealing Obamacare would lead to a vast increase in the number of uninsured. Bad estimates produced bad policy.”
[...]
---
the paywalled paper:
National Health Expenditure Projections, 2018–27: Economic And Demographic Trends Drive Spending And Enrollment Growth. By Andrea M. Sisko, Sean P. Keehan, John A. Poisal, Gigi A. Cuckler, Sheila D. Smith, Andrew J. Madison, Kathryn E. Rennie, and James C. Hardesty
doi: 10.1377/hlthaff.2018.05499
ABSTRACT National health expenditures are projected to grow at an average annual rate of 5.5 percent for 2018–27 and represent 19.4 percent of gross domestic product in 2027. Following a ten-year period largely influenced by the Great Recession and major health reform, national health spending growth during 2018–27 is expected to be driven primarily by long-observed demographic and economic factors fundamental to the health sector. Prices for health care goods and services are projected to grow 2.5 percent per year, on average, for 2018–27—faster than the average price growth experienced over the last decade—and to account for nearly half of projected personal health care spending growth. Among the major payers, average annual spending growth in Medicare (7.4 percent) is expected to exceed that in Medicaid (5.5 percent) and private health insurance (4.8 percent) over the projection period, mostly as a result of comparatively higher projected enrollment growth. The insured share of the population is expected to remain stable at around 90 percent throughout the period, as net gains in health coverage from all sources are projected to keep pace with population growth.
-
During 2018–27 national health spendingisexpectedtobedriven primarily by long-observed demographic and economic factors fundamentaltothehealthsector, largely in contrast to the prior decade—which was affected by the notable impacts of a historic recessionand the implementation of wide-ranging health reform legislation.1 Overall, national health spending is projected to grow at 5.5 percentperyear,onaverage,for2018–27(exhibit1). This is faster than the average growth rate experiencedfollowingthelastrecession(3.9percent for 2008–13) and the more recent period inclusive of the Affordable Care Act’s major coverage expansions(5.3percentfor2014–16).However, it is slower than the rate throughout the nearly two decades preceding the Great Recession (7.3 percent for 1990–2007). Growth in gross domesticproduct(GDP)duringtheten-yearprojectionperiodisprojectedtoaverage4.7percent. Because national health spending growth is expectedtoincrease0.8percentagepointfaster, onaverage,thangrowthinGDPovertheprojection period, the health share of GDP is expected to rise from 17.9 percent in 2017 to 19.4 percent in 2027, with almost all of the increase in share expected after 2020. Projected average annual spending growth rates for the underlying major payers of health care are expected to vary substantially during 2018–27,mainlyasaresultofdifferingexpected trends in enrollment growth. Average Medicare spendinggrowthisprojectedtobethefastest,at
doi: 10.1377/hlthaff.2018.05499 HEALTH AFFAIRS 38, NO. 3 (2019): – ©2019 Project HOPE— The People-to-People Health Foundation, Inc.
Andrea M. Sisko (Andrea .Sisko@cms.hhs.gov) is an economist in the Office of the Actuary, Centers for Medicare and Medicaid Services (CMS), in Baltimore, Maryland.
Sean P. Keehan is an economist in the CMS Office of the Actuary.
John A. Poisal is a deputy director of the National Health Statistics Group, CMS Office of the Actuary.
Gigi A. Cuckler is an economist in the CMS Office of the Actuary.
Sheila D. Smith is an economist in the CMS Office of the Actuary.
Andrew J. Madison is an actuary in the CMS Office of the Actuary.
Kathryn E. Rennie is an actuary in the CMS Office of the Actuary.
James C. Hardesty is an actuary in the CMS Office of the Actuary.
March 2019 38:3 Health Affairs 1
Costs & Spending
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Exhibit 1
National health expenditures(NHE),aggregateand percapitaamounts,shareofgross domesticproduct(GDP), andaverageannualgrowthfromprevious year shown, by source of funds, selected calendar years 2013–27
Source of funds 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions NHE $2,881.8 $3,361.1 $3,492.1 $3,646.9 $3,823.1 $5,963.2 Health consumption expenditures 2,728.6 3,202.9 3,324.5 3,470.3 3,637.6 5,679.9 Out of pocket 325.9 356.1 365.5 378.6 396.9 585.8 Health insurance 2,088.1 2,504.5 2,604.2 2,720.9 2,850.6 4,545.8 Private health insurance 947.1 1,136.4 1,183.9 1,237.7 1,278.2 1,896.7 Medicare 589.9 677.1 705.9 747.4 800.1 1,436.8 Medicaid 445.2 565.6 581.9 594.8 623.4 992.1 Federal 256.9 358.3 361.2 369.5 386.5 611.1 State and local 188.4 207.3 220.6 225.3 237.0 380.9 Other health insurance programsc 105.9 125.3 132.6 141.0 148.8 220.2 Other third-party payers and programs and public health activity 314.7 342.4 354.8 370.8 390.0 548.4 Investment 153.2 158.2 167.6 176.5 185.5 283.3 Population (millions) 315.7 322.9 325.2 327.9 330.7 352.7 GDP, billions $16,784.9 $18,707.2 $19,485.4 $20,498.6 $21,503.1 $30,755.4 Disposable personal income, billions 12,505.3 14,170.9 14,796.3 15,563.2 16,297.3 23,453.9 NHE per capita 9,128.9 10,410.1 10,739.1 11,121.2 11,559.3 16,907.0 GDP per capita 53,170.5 57,941.2 59,922.8 62,511.0 65,015.9 87,198.3 Prices (2012=100.0) Personal Health Care Price Index 1.015 1.049 1.062 1.081 1.101 1.359 GDP Implicit Price Deflator, chain weighted 1.018 1.059 1.079 1.104 1.130 1.344 NHE as percent of GDP 17.2% 18.0% 17.9% 17.8% 17.8% 19.4% Annual growth NHE 3.9% 5.3% 3.9% 4.4% 4.8% 5.7% Health consumption expenditures 4.0 5.5 3.8 4.4 4.8 5.7 Out of pocket 2.0 3.0 2.6 3.6 4.8 5.0 Health insurance 4.4 6.2 4.0 4.5 4.8 6.0 Private health insurance 3.4 6.3 4.2 4.5 3.3 5.1 Medicare 5.3 4.7 4.2 5.9 7.1 7.6 Medicaid 5.3 8.3 2.9 2.2 4.8 6.0 Federal 5.6 11.7 0.8 2.3 4.6 5.9 State and local 5.0 3.2 6.4 2.1 5.2 6.1 Other health insurance programsc 6.0 5.8 5.8 6.4 5.5 5.0 Other third-party payers and programs and public health activity 3.4 2.9 3.6 4.5 5.2 4.4 Investment 1.7 1.1 6.0 5.3 5.1 5.4 Populationd 0.8 0.8 0.7 0.8 0.9 0.8 GDP 2.5 3.7 4.2 5.2 4.9 4.6 Disposable personal income 2.9 4.3 4.4 5.2 4.7 4.7 NHE per capita 3.0 4.5 3.2 3.6 3.9 4.9 GDP per capita 1.7 2.9 3.4 4.3 4.0 3.7 Prices (2012=100.0) Personal Health Care Price Index 2.2 1.1 1.3 1.7 1.9 2.7 GDP Implicit Price Deflator, chain weighted 1.6 1.3 1.9 2.3 2.3 2.2
SOURCES Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group; and Department of Commerce, Bureau of Economic Analysis and Bureau of the Census. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017: definitions, sources, and methods [Internet]. Baltimore (MD): Centers for Medicare and Medicaid Services; [cited 2019 Jan 25]. Available from: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/dsm-17.pdf. Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables [Internet]. Baltimore (MD): Centers for Medicare and Medicaid Services; 2019 [cited 2019 Feb 20]. Available from: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/Proj2018Tables.zip. aAnnual growth, 2008–13. bProjected. cIncludes health-related spending for Children’s Health Insurance Program (CHIP), Titles XIX and XXI; Department of Defense; and Department of Veterans Affairs. dEstimates reflect the Bureau of the Census’s definition of resident-based population (which includes all people who usually reside in the fifty states or the District of Columbia but excludes residents living in Puerto Rico and areas under US sovereignty, and US Armed Forces overseas and US citizens whose usual place of residence is outside of the United States). Estimates also include a small (typically less than 0.2 percent of population) adjustment to reflect census undercounts. Projected estimates reflect the area population growth assumptions found in the 2018 Medicare Trustees Report (see note 4 in text).
Costs & Spending
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7.4 percent per year, as the shift of the babyboom generation into the program continues toresultinrobustgrowthinenrollment(2.5percent per year, on average) (exhibit 2). This shift also contributes to comparatively slower projected private health insurance enrollment growth of just 0.2 percent per year in 2018–27 and underlies the expectation that growth in private health insurance spending will be the slowest among the payers, at just 4.8 percent peryear,onaverage.Medicaidspendinggrowth is expected to be 5.5 percent, on average, with projected enrollment growth of 1.3 percent per year during this period. Per enrollee, rates of growth in spending for Medicare, Medicaid, and private health insurance are expected to be somewhat similar over the ten-year projection period (4.7 percent,
4.1percent,and4.6percentperenrollee,respectively). However, these averages mask the unique year-to-year trends among the major payersthatareinfluencedbyregulation,legislation, and economic factors—each of which is discussed in more detail below. For 2018, national health spending is projected to have grown by 4.4 percent, following a rate of 3.9 percent in 2017 (exhibit 1).1 Faster projected spending growth of almost 2 percentage points in Medicare (5.9 percent) primarily contributes to the acceleration that reflectshigherexpectedgrowthforbothhospital services and prescription drugs. However, Medicaid spending growth is projected to have slowed by 0.7 percentage point in 2018 (to 2.2 percent), as enrollment growth is expected to have slowed for the fourth consecutive year.
Exhibit 2
National health expenditures (NHE) and health insurance enrollment, aggregate and per enrollee amounts, and average annual growth from previous year shown, by source of funds, selected calendar years 2013–27
Source of funds 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions Private health insurance $947.1 $1,136.4 $1,183.9 $1,237.7 $1,278.2 $1,896.7 Medicare 589.9 677.1 705.9 747.4 800.1 1,436.8 Medicaid 445.2 565.6 581.9 594.8 623.4 992.1 Annual growth in expenditure Private health insurance 3.4% 6.3% 4.2% 4.5% 3.3% 5.1% Medicare 5.3 4.7 4.2 5.9 7.1 7.6 Medicaid 5.3 8.3 2.9 2.2 4.8 6.0 Per enrollee spending Private health insurance $ 5,052 $ 5,771 $ 6,001 $ 6,269 $ 6,511 $ 9,384 Medicare 11,503 12,144 12,347 12,726 13,240 19,546 Medicaid 7,553 7,944 8,013 8,099 8,289 12,029 Annual growth in per enrollee spending Private health insurance 4.3% 4.5% 4.0% 4.5% 3.9% 4.7% Medicare 2.4 1.8 1.7 3.1 4.0 5.0 Medicaid 0.9 1.7 0.9 1.1 2.4 4.8 Enrollment, millions Private health insurance 187.5 196.9 197.3 197.4 196.3 202.1 Medicare 51.3 55.8 57.2 58.7 60.4 73.5 Medicaid 58.9 71.2 72.6 73.4 75.2 82.5 Uninsured 44.1 28.7 29.7 29.9 31.2 36.2 Population 315.7 322.9 325.2 327.9 330.7 352.7 Insured share of total population 86.0% 91.1% 90.9% 90.9% 90.6% 89.7% Annual growth in enrollment Private health insurance −0.9% 1.7% 0.2% 0.1% −0.6% 0.4% Medicare 2.9 2.8 2.5 2.7 2.9 2.5 Medicaid 4.4 6.5 2.0 1.1 2.4 1.2 Uninsured 1.2 −13.4 3.7 0.7 4.3 1.9 Population 0.8 0.8 0.7 0.8 0.9 0.8
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017 (see exhibit 1 notes). Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables (see exhibit 1 notes). aAnnual growth, 2008–13. bProjected.
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Fromtheperspectiveofoverallhealthinsurance enrollment,netgainsinhealthinsurancecoverage across all sources are expected to have kept pacewithoverallpopulationgrowth.Asaresult, the insured share of the population is projected to have remained stable at 90.9 percent. For 2019, growth in national health spending is expected to increase again to 4.8 percent (exhibit 1). Medicare spending growth is projected to continue accelerating (to 7.1 percent), partlyas aresultof fastergrowth inperenrollee spending attributable to higher fee-for-service payment updates. Growth in Medicaid expenditures is also expected to rise (to 4.8 percent), in partbecauseofexpansionsofMedicaidcoverage in Idaho, Maine, Nebraska, Utah, and Virginia. A somewhat mitigating influence on overall national health spending growth, however, is the expected impact of the repeal of the individual mandate. The repeal is expected to result in lowerprivatehealthinsuranceenrollment,since some people—particularly those with directpurchase insurance—may elect to forgo coverage.2,3 Combined,theseshiftsinenrollmentlead to a projected net increase in the number of uninsured of 1.3 million people, to 31.2 million in2019(exhibit 2). However,projectedgains in enrollment through other sources are expected to partially offset those declines, resulting in only a slight decrease in the insured share of the population (to 90.6 percent in 2019, from 90.9 percent in 2018). For2020–27,growthinnationalhealthspendingisexpectedtoaverage5.7percent.Thisrateis fasterthanprojectedfor2019,andfastergrowth is generally evident for the underlying major payers and health care services and goods (exhibits 1 and 3). The acceleration is in part duetofastergrowthinpersonalhealthcarepricesasmeasuredbythePersonalHealthCarePrice Index (exhibit 1). Also contributing is increasingly higher expected growth in utilization on thepartofMedicarebeneficiariesandthosewith privatehealthinsurance,thelatterinfluencedby a lagged response to comparatively higher income growth during 2020–22. With respect to insurance coverage over 2020–27, growth in employer-sponsored health insurance enrollmentis projected to bebelow thatof population growth and decline for those purchasing insurance directly, which contributes to a slight decline in the insured share of the population to 89.7 percent by 2027 (exhibit 2). The share of health care spending sponsored (orfinanced)byfederal,state,andlocalgovernments is expected to increase by 2 percentage points during 2018–27, reaching 47 percent by 2027 (exhibit 4). The increase is entirely accounted for by the federal government share,
which is expected to grow from 28 percent in 2017 to 31 percent in 2027, and largely reflects fastergrowth inMedicare spending as the babyboomgenerationcontinuestotransitionintothe program. The expected business and household share is expected to fall from 55 percent in 2017 to 53 percent in 2027.
Model And Assumptions The national health expenditure projections incorporate a combination of actuarial and econometricmodelingmethods,aswellasjudgments about future events and trends that are expectedtoinfluencehealthspending.3 Theyare largely based on economic and demographic assumptions in the 2018 Medicare Trustees Report,4updatedtoreflectmorerecentlyreleased macroeconomic data.3 The projections also reflect current law5 and do not reflect any policy proposals currently under consideration. Estimates of future health care spending and enrollment are inherently subject to substantial uncertainty that increases over the projection horizon. In addition to the potential effects of evolvinghealthcaremarketsandchangesinlaw over time, economic conditions can differ from the intended midrange assumptions used here. In the case of one economic variable, disposable personal income, analysis by the Office of theActuaryhasconsistentlyfoundarelationship between growth in that metric and growth in health spending, especially for private health insurance.3 That is, as income growth increases or decreases, health spending growth tends to follow in the same direction, but with a lag. Thisrelationshiphasbeenevidentoverthefull history of the National Health Expenditure Accounts and is reflected in these projections.3 As a result, with faster growth in income assumed for the coming decade relative to the recent past, it is expected that health spending growth will respond and be higher as well.3 The projections presented here reflect this relationship. Thus, to the extent that actual growth in income differs from what is assumed, actual growthinhealthspendingmaydifferfromwhat is projected.
Factors Accounting For Growth Inexhibit5averageannualpersonalhealthcare spending6growthisdecomposedtodemonstrate the relative contributions of underlying price growth (economywide and relative personal health care price inflation), use and intensity, population growth, and age-sex mix. During 2018–27 personal health care spending growth is expected to average 5.5 percent, with growth
Costs & Spending
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in personal health care prices expected to account for nearly half of that growth, on average. Growth in use and intensity is expected to account for just under one-third of the average annual personal health care spending growth, with population growth and the changing age-sex mix of the population accounting for
the remainder. Over specific years within the projection period, however, there are notable trends in prices and the volume and intensity of services, some of which are anticipated to contrast with recent experience. Inflationforhealthcaregoodsandservices,as measured by the Personal Health Care Price
Exhibit 3
National health expenditures (NHE) amounts and annual growth from previous year shown, by spending category, selected calendar years 2013–27
Spending category 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions NHE $2,881.8 $3,361.1 $3,492.1 $3,646.9 $3,823.1 $5,963.2 Health consumption expenditures 2,728.6 3,202.9 3,324.5 3,470.3 3,637.6 5,679.9 Personal health care 2,438.0 2,851.9 2,961.0 3,085.3 3,242.5 5,058.4 Hospital care 937.6 1,092.8 1,142.6 1,193.4 1,254.7 1,961.6 Professional services 759.4 884.0 920.0 962.8 1,013.6 1,541.2 Physician and clinical services 569.6 666.5 694.3 728.0 767.6 1,172.0 Other professional services 78.7 92.4 96.6 100.8 106.1 165.3 Dental services 111.1 125.1 129.1 134.0 139.9 203.9 Other health, residential, and personal care 144.3 173.4 183.1 188.4 196.9 318.6 Home health care 81.4 93.1 97.0 101.8 108.8 186.8 Nursing care facilities and continuing care retirement communities 149.0 163.0 166.3 170.8 178.0 270.7 Retail outlet sales of medical products 366.3 445.6 451.9 468.1 490.5 779.4 Prescription drugs 265.2 332.0 333.4 344.5 360.3 576.7 Durable medical equipment 45.1 51.0 54.4 57.4 60.9 97.8 Other nondurable medical products 56.0 62.7 64.1 66.2 69.3 105.0 Government administration 37.4 44.7 45.0 46.7 49.4 81.0 Net cost of health insurance 174.2 220.7 229.5 247.2 252.0 417.3 Government public health activities 79.1 85.6 88.9 91.1 93.6 123.2 Investment 153.2 158.2 167.6 176.5 185.5 283.3 Noncommercial research 46.7 47.6 50.7 53.5 56.2 83.3 Structures and equipment 106.5 110.6 116.9 123.1 129.3 200.0 Annual growth NHE 3.9% 5.3% 3.9% 4.4% 4.8% 5.7% Health consumption expenditures 4.0 5.5 3.8 4.4 4.8 5.7 Personal health care 4.1 5.4 3.8 4.2 5.1 5.7 Hospital care 5.2 5.2 4.6 4.4 5.1 5.7 Professional services 3.6 5.2 4.1 4.7 5.3 5.4 Physician and clinical services 3.7 5.4 4.2 4.9 5.4 5.4 Other professional services 4.6 5.5 4.6 4.3 5.3 5.7 Dental services 2.2 4.0 3.2 3.8 4.4 4.8 Other health, residential, and personal care 4.9 6.3 5.6 2.9 4.5 6.2 Home health care 6.0 4.6 4.3 4.9 6.8 7.0 Nursing care facilities and continuing care retirement communities 3.0 3.0 2.0 2.7 4.2 5.4 Retail outlet sales of medical products 2.2 6.8 1.4 3.6 4.8 6.0 Prescription drugs 2.0 7.8 0.4 3.3 4.6 6.1 Durable medical equipment 3.3 4.2 6.8 5.5 6.1 6.1 Other nondurable medical products 2.7 3.8 2.2 3.3 4.7 5.3 Government administration 4.2 6.1 0.5 3.9 5.7 6.4 Net cost of health insurance 3.3 8.2 4.0 7.7 2.0 6.5 Government public health activities 3.1 2.7 3.9 2.4 2.8 3.5 Investment 1.7 1.1 6.0 5.3 5.1 5.4 Noncommercial research 1.5 0.7 6.5 5.4 5.1 5.0 Structures and equipment 1.8 1.3 5.7 5.3 5.1 5.6
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017 (see exhibit 1 notes). Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables (see exhibit 1 notes). aAnnual growth, 2008–13. bProjected.
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Index and inclusive of both economywide and relative personal health care price inflation, is projected to play a larger role in the coming decade (averaging growth of 2.5 percent per year for 2018–27, compared to 1.1 percent for 2014–17)andaccountfornearlyhalfofpersonal health care spending growth. This expectation reflects accelerating growth in both economywide inflation and relative personal health care price inflation (or the difference between price growth for personal health care goods and servicesand economywideinflation).Theexpected acceleration in growth in economywide prices occurredprimarily in 2018. From 2019 forward, asteadyincreaseinrelativepersonalhealthcare priceinflationisprojected,ascertainfactorsthat
contributedtolowornegativegrowthinrelative personal health care price inflation since 2011 are anticipated to be less influential in restraining prices over the next decade. Such factors includerisingsensitivitytopricesbyconsumers and insurers, especially for services subject to cost sharing;7 selective contracting by insurers; and improvements in productivity through the useoflower-costprovidersinphysicianoffices.8 Similarly, input price growth, including healthsector wages, is expected to accelerate as downward pressure on provider prices lessens. The average growth rate for use and intensity of services is projected to be 1.7 percent over 2018–27 and to account for about 30 percent ofpersonalhealthcarespendinggrowth(exhib
Exhibit 4
National healthexpenditures(NHE) amounts,average annualgrowthfromprevious yearshown, and percentdistribution, by type of sponsor, selected calendar years 2013–27
Type of sponsor 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions NHE $2,881.8 $3,361.1 $3,492.1 $3,646.9 $3,823.1 $5,963.2 Businesses, household, and other private revenues 1,620.6 1,836.7 1,914.1 2,002.9 2,095.2 3,136.4 Private businesses 580.4 669.1 696.5 730.9 765.1 1,123.2 Household 833.0 942.8 978.6 1,019.9 1,064.1 1,619.3 Other private revenues 207.2 224.7 239.0 252.0 266.0 393.9 Governments 1,261.2 1,524.4 1,577.9 1,644.0 1,727.9 2,826.8 Federal government 752.7 952.4 982.4 1,032.7 1,089.7 1,833.8 State and local governments 508.5 572.0 595.5 611.2 638.2 993.0 Annual growth NHE 3.9% 5.3% 3.9% 4.4% 4.8% 5.7% Businesses, household, and other private revenues 2.8 4.3 4.2 4.6 4.6 5.2 Private businesses 2.3 4.9 4.1 4.9 4.7 4.9 Household 3.1 4.2 3.8 4.2 4.3 5.4 Other private revenues 3.3 2.7 6.4 5.4 5.6 5.0 Governments 5.3 6.5 3.5 4.2 5.1 6.3 Federal government 6.1 8.2 3.2 5.1 5.5 6.7 State and local governments 4.2 4.0 4.1 2.6 4.4 5.7 Distribution NHE 100% 100% 100% 100% 100% 100% Businesses, household, and other private revenues 56 55 55 55 55 53 Private businesses 20 20 20 20 20 19 Household 29 28 28 28 28 27 Other private revenues 7 7 7 7 7 7 Governments 44 45 45 45 45 47 Federal government 26 28 28 28 29 31 State and local governments 18 17 17 17 17 17
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017 (see exhibit 1 notes). Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables (see exhibit 1 notes). aAnnual growth, 2008–13. bProjected.
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it5).Thisresultcontrastswiththerateobserved during the years immediately following the implementation of the coverage expansions under theAffordableCareAct(2014–16),whenuseand intensity was the dominant driver of personal health care spending growth—representing 2.9 percentage points, or just over half, of the average spending growth rate of 5.4 percent. Initially, these increases were largely influenced by expanding enrollment, followed by faster per enrollee spending growth that likely reflected care provided to the newly insured. Unlike that unique time period, during 2018–27 growth in the use and intensity of medical care isprimarilyinfluencedbytheanticipatedeffects of macroeconomic growth consistent with the longer-run historical relationship.
Outlook For Spending And Enrollment By Payer Medicare Medicare spending growth is projected to have increased 5.9 percent in 2018, compared to 4.2 percent in 2017 (exhibit 1), mainly because of faster per enrollee spending growth(3.1percentin2018versus1.7percentin 2017) (exhibit 2). Increases in Medicare private health plan payments, as well as spending for fee-for-service hospital care and prescription
drugs, underlie the projected acceleration. In 2019 Medicare spending is projected to increase by 7.1 percent, a 1.2-percentage-point acceleration over growth in 2018. Increases in fee-for-servicepaymentratescomparedto2018, along with slightly faster growth in the use and intensity of physician and clinical services, contribute to faster expected growth in perenrollee spending, which is projected to rise to 4.0 percent. Additionally, projected Medicare enrollment growth reaches its peak at 2.9 percent in 2019, up from 2.7 percent in 2018. Over 2020–27 Medicare spending growth is expected to remain highest among the payers, averaging 7.6 percent. Compared to the 7.1 percent increase projected for 2019, this faster average growth is primarily driven by an expectation of a continued rebound in growth in the useandintensityofservicesusedthroughoutthe period that is more consistent with the program’s long-term experience, compared to that of the past decade. By the end of the projection period (2026–27) the expected growth rate decelerates to around 7.0 percent, down from a projection-period peak of 8.1 percent in 2022, as slower increases in input prices— including for hospitals—and anticipated faster multifactor productivity growth lead to smaller payment updates for many Part A services. En
Exhibit 5
Factors accounting for growth in personal health care (PHC) expenditures, selected calendar years 1990–2027
SOURCES Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group; and Department of Commerce, Bureau of Economic Analysis and Bureau of the Census. NOTES “Relative PHC inflation” represents the share of medical price growth that exceeds economywide inflation. “Economywide inflation” reflects the gross domestic product deflator index. “Use and intensity” includes quantity and mix of services. As a residual, this factor also includes any errors in measuring prices or total spending. “Age-sex mix” refers to that mix in the population. Growth in the total PHC Price Index is equal to the sum of economywide and relative PHC inflation and is a chain-weighted index of the price for all personal health care deflators. The height of the bars reflects the sum of factors that contribute positively to growth. In those cases where a factor may contribute growth of less than zero, the net total growth is reflected by the line and associated point estimate noted for each period.
March 2019 38:3 Health Affairs 7
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rollmentgrowthisalsoanticipatedtoslowgradually during these years, from 2.8 percent in 2020to2.1percentby2027—aratemoreconsistent with the pre-baby-boom period. By the end of the projection period the Medicare share of total health spending is projected to rise to 24.1 percentby 2027 from 20.2 percentin 2017. Medicaid Medicaid spending growth is expected to have been just 2.2 percent in 2018, down from 2.9 percent growth in 2017 (exhibit 1)—the fourth consecutive year of slowing growth following the ACA’s expansion of Medicaid coverage in 2014. The expected trend in2018,asinprioryears,isprincipallyexplained by slower growth in enrollment, which is projected to have slowed to 1.1 percent in 2018 from 2.0 percent the previous year (exhibit 2). While growth for nearly all Medicaid services is expected to have slowed in 2018, growth in the net cost for Medicaid managed care plans is expected to have rebounded, compared to a decline in growth in 2017. This pattern reflects the historical and projected timeline over which the federal government is recovering payments from managed care organizations as a result of favorable prior-period experience.1 Growth in Medicaid spending is expected to acceleratein2019to4.8percent.Fiveadditional states have approved and are expected to implement Medicaid expansion in 2019, a factor that contributes in part to the aggregate spending growthincrease.ProjectedMedicaidenrollment growth—2.4percentin2019comparedto1.1percentin2018—reflectsthisnewlyeligiblepopulation. Growth in per enrollee Medicaid spending is expected to accelerate, as well, by 1.3 percentage points to 2.4 percent in 2019, as a result of faster growth in price factors. Medicaid spending is expected to grow at an average rate of 6.0 percent over 2020–27. The patterninannualgrowth,however,isinfluenced byreductionstodisproportionatesharehospital payments for hospitals set in law.9 These payments are scheduled to be reduced in 2020 and are then further reduced in 2021. Consequently, Medicaid spending growth is expected to grow slowly at 5.0 percent in 2020 and 5.4 percent in 2021. For 2022 through 2025, when the disproportionate share hospital payment reductions are equivalent to 2021, overall Medicaid spending growth is expected to be higher at 6.1 percent. Beginning in 2026 there are no reductions in the disproportionate share hospital payments,whichleadstoanotableexpectedoneyear acceleration in 2026 for overall Medicaid spending growth to 7.0 percent. Otherwise, an enrollment mix more heavily influenced by spendingpatternsofcomparativelymoreexpensive aged and disabled beneficiaries is expected
to result in per enrollee spending growth that is at or above 5 percent in every year during 2022–27. Private Health Insurance And Out-OfPocket Spending For private health insurance spending, growth is expected to have increased slightlyfrom4.2percentin2017to4.5percentin 2018, near the overall growth rate for national health expenditures of 4.4 percent (exhibit 1). While spending for most services and goods is expected to have grown slightly faster in 2018,10 the acceleration was partially offset by slower projectedgrowthinthenetcostofprivatehealth insurance,11 as private insurers offering plans in the Marketplace had fared better financially in 2017 and thus reduced the difference between premium revenues and expected benefit payments.12 Out-of-pocket spending growth is expected to have accelerated to 3.6 percent in 2018 from 2.6 percent in 2017, a rate that is consistent with faster income growth as well as with the higher average deductibles for employer-based private health insurance enrollees in 2018 compared to 2017.13 The projected spending trends in 2019 in part reflect the estimated impact of the effective repeal of the individual mandate. As some people choose to forgo maintaining health insurance, private health insurance enrollment is expected to decline slightly, primarily in the directpurchaseinsurancemarket.Accordingly,private health insurance spending growth is expected to slow to 3.3 percent in 2019 from 4.5 percent in 2018. Conversely, out-of-pocket spending is expected to grow more rapidly,at 4.8 percentin 2019 compared to 3.6 percent in 2018, in part because fewer people have private insurance coverage. Private health insurance spending is expected to grow 5.1 percent per year, on average, for 2020–27. Growth in this spending is projected to peak at 5.4 percent in 2023–24, in lagged response to the high anticipated growth in disposable personal income a few years prior. Private health insurance spending growth is then expected to slow to 4.8 percent by 2027, as income growthgenerallydecelerates.As the payer with the slowest expected growth over the full projection period, the private health insurance shareofnationalhealthspendingisprojectedto fall from 33.9 percent in 2017 to 31.8 percent in 2027. Growth in out-of-pocket spending, which is also primarily influenced by economic factors, isexpectedtobesimilartothatofprivatehealth insurance spending in 2020–27, at 5.0 percent. However, the projection-period peak in growth is expected in 2022 (5.4 percent), the year in which the excise tax on high-cost insurance
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plans is scheduled to go into effect.14 By 2027, becausetotalout-of-pocketspendingisexpected to grow more slowly, on average, than health insurance spending (exhibit 1), it is expected to account for a decreasing share of national health spending (9.8 percent in 2027, down from 10.5 percent in 2017).
Outlook For Major Medical Services And Goods Prescription Drugs Following growth of just 0.4 percent in 2017, prescription drug spending isexpectedtohavegrown3.3percentin2018but still be among the slowest-growing health care sectors (exhibit 3). Higher utilization growth is anticipated, compared to the relatively low growth in 2016 and 2017,1 partially driven by anincreaseinthenumberofnewdrugintroductions (fifty-nine in 2018, up from an average of thirty-four during 2016–17).15 In 2019 prescription drug spending growth is projectedtoacceleratefurther,to4.6percent,as a result of higher expected growth in drug utilization(includingfromnewdrugs)andamodest increase in drug price growth. Prescription drug spending is expected to increase, on average, by 6.1 percent per year for 2020–27 (exhibit 3). Contributing to the acceleration in growth during this period is the expectation that the use of prescription drugs will increaseoverthenextseveralyearsasaresultof increasingly robust efforts by employers and insurerstoreduceanybarriersregardingtheuseof maintenance drugs needed to keep their enrolleeswithchronicconditionshealthy.16 Twoother factors contributing to higher expected growth in the use of prescription drugs are the aging of thepopulationandchangestopharmacotherapy guidelines.16 These trends, coupled with faster expected spending increases in lagged response to faster growth in income, result in a peak projected growth rate for prescription drug spending of 6.4 percent in 2023–24. Finally, prescription drug spending growth is expected to rise becauseofashiftintheintensityandmixofdrug usageassociatedwiththemanyprojectscurrently in clinical development that could, over the nextfewyears,resultininnovative,yetmoreexpensive,newdrugsacrosssuchtherapeuticareas as cancer, diabetes, and Alzheimer’s disease.17 Hospitals Hospital spending is expected to have grown similarly in 2018 (4.4 percent) and 2017 (4.6 percent) (exhibit 3). By payer, somewhatslowergrowthinbothMedicaidandprivate healthinsurancehospitalspendingoffsetslightly faster growth in Medicare hospital spending. For2019hospitalspendinggrowthisexpectedto increase to 5.1 percent because of faster growth
in Medicare hospital payment updates and an increaseintheuseofhospitalservicesassociated withnewMedicaidexpansion–relatedenrollees. These increases are somewhat offset by slower expectedgrowthinprivatehealthinsurancehospital spending, which is partially attributable to the repeal of the individual mandate. Over2020–27hospitalspendinggrowthisexpected to average 5.7 percent per year, up from 5.1 percent in 2019. Consistent with overall spending, Medicare is expected to experience the fastest growth in spending for hospital care during this period. The peak growth for overall hospital spending is projected to occur in 2026 (6.1 percent) and is strongly influenced by substantially faster Medicaid spending growth in 2026 that reflects the expiration of Medicaid disproportionate share hospital payment reductions scheduled in current law for September 30, 2025. Private health insurance spending growth for hospital care is expected toreachitsprojection-periodpeakin2024,consistent with the lagged relationship to income. Hospital price growth is also expected to rise by2027.Theaccelerationinthisgrowthoverthe projection period primarily reflects continued wage increases for hospital employees that are anticipated from the low rates of growth experienced following the Great Recession, as well as tighter labor markets for hospital employees, including nurses.18 Growth is partially offset, however, by Medicare payment updates that are reduced by growth in economywide productivity,whichisprojectedtoaccelerateduringthe projection period.4 Physician And Clinical Services Spending in2018forphysicianandclinicalservicesisprojected to have grown 4.9 percent, rising from 4.2 percent in 2017 (exhibit 3). Price growth for physician and clinical services is expected to have increased 0.3 percentage point but to have remained at near historically low rates at 0.7percent.Thiscontinuedlowpricegrowthwas likely influenced, in part, by physician practices using more nonphysicians to provide care, a practicethatwasrelatedtoincreasedproductivity and profits even in the presence of slow price growth.8 The acceleration in overall projected spending growth also reflects faster growth in use that is partly related to a lagged response to growth in income over the recent history and alsofromincreasesinthenumberofofficevisits due to the severe 2017–18 flu season.19 In2019,growthinspendingforphysicianand clinical services is projected to accelerate once more,to5.4percentfrom4.9percentin2018.An accelerationinMedicaidspendinggrowthisthe primary factor contributing to the trend, which is in part associated with program’s expansion
March 2019 38:3 Health Affairs 9
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by additional states. Over the remainder of the projection period, 2020–27, average annual growth in physician and clinical services spending is projected to be 5.4 percent. The growth rate for Medicare spending is expected to be substantially faster than that projected for physician and clinical services spending in private health insurance. Thatprojecteddifferentialislargelyduetofaster enrollment associated with the continued shift ofthebaby-boomgenerationfromprivatehealth insurance to Medicare. Another factor contributing to the growth in overall physician and clinical services spending over 2020–27 is an anticipated acceleration in physicianprice growth.Underlyingthisacceleration are projected rising costs related to the provision of care. In particular, wages are expected to increase as a result of the supply of physicians not being able to meet expected increases in demand for care connected with the aging population.20 Furthermore, some of the productivity gains that have been achieved throughtheuseoflower-costprovidersasasubstitute for physician care within physician practices may be less pronounced in the future, becauseoflimitationssuchaslicensingrestrictions on the scope of care that may be provided by nonphysician providers.21
Conclusion Duringthepasttenyearsthelingeringeffectsof the Great Recession, coupled with the coverage
and payment provisions of the Affordable Care Act, have significantly influenced the trends in healthcarespendingandenrollmentintheUnited States. Over the next decade, however, the outlook for health spending and insurance coverage isexpected to beprimarily drivenby longobserved demographic and economic factors fundamental to the health sector. While the national health spending growth rate is projected to average 5.5 percent per year for 2018–27 (exhibit 1), annual growth is expected to generally accelerate over much of the projection period. Medicare spending growth is expected to accelerate and be the fastest among the major payers, reflecting not only the continued enrollment shift of the baby-boom generationintotheprogrambutalsothegrowthratefor useandintensity,whichisprojectedtogradually increase toward the rates observed during Medicare’s long-term history. Growth in health care prices,reflectingbotheconomywideandrelative personal health care price inflation, is also expected to rebound somewhat toward rates more consistent with the period before the Great Recession and to return to a state in which personal health care price growth exceeds that of economywidepriceinflation.Finally,recentand anticipatedfastergrowthindisposablepersonal income is expected to lead to an increased demand for services, albeit with a lag, and put upwardpressureonthepatternofprivatehealth insurance and out-of-pocket spending growth over the projection period. ▪
The opinions expressed here are the authors’ and not necessarily those of the Centers for Medicare and Medicaid
Services. The authors thank Paul Spitalnic, Stephen Heffler, Aaron Catlin, Micah Hartman, Greg Savord, Cathy
Curtis, and anonymous peer reviewers for their helpful comments. [Published online February 20, 2019. ]
NOTES
1 Martin AB, Hartman M,Washington B, Catlin A, National Health Expenditure Accounts Team. National healthcarespendingin2017:growth slows to post–Great Recession rates; share of GDP stabilizes. Health Aff (Millwood). 2019;38(1):96–106. 2 By 2019 the individual mandate repeal is anticipated to result in about 1.5 million fewer direct-purchasemarket enrollees, who are expected to be somewhat younger and healthier than those who retain coverage, aswellasabout1.0 million fewer employer-sponsoredinsurance-market enrollees, than otherwise would have been projected. After 2019 the enrollment effects are expected to be smaller. Medicaid enrollment is assumed to be unaffected. See Centers for Medicare and Medicaid Services.
Projections of national health expenditures (note 3). 3 Centers for Medicare and Medicaid Services. Projections of national health expenditures: methodology and model specification [Internet]. Baltimore (MD): CMS; 2018 Feb 14 [cited 2019 Feb 4]. Available from: https://www.cms.gov/ResearchStatistics-Data-and-Systems/ Statistics-Trends-and-Reports/ NationalHealthExpendData/ Downloads/Projections Methodology.pdf 4 Boards of Trustees. 2018 annual report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds [Internet]. Baltimore (MD): Centers for Medicare and Medicaid Services; 2018 [cited 2019 Jan 25]. Available from:
https://www.cms.gov/ResearchStatistics-Data-and-Systems/ Statistics-Trends-and-Reports/ ReportsTrustFunds/Downloads/ TR2018.pdf 5 Consistent with the methods employed in the Medicare Trustees Report (see note 4), these projections assume that payments would continue to be made even after the projected depletion of the Medicare Hospital Insurance trust fund, currently projected to occur in 2026. 6 Personal health care expenditures (PHC) measures the total amount spent to treat people with specific medical conditions. It represents about 85 percent of total national health expenditures over the projection period. 7 Brot-Goldberg ZC, Chandra A, Handel BR, Kolstad JT.What does a
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deductible do? The impact of costsharing on health care prices, quantities, and spending dynamics [Internet]. Cambridge (MA): National Bureau of Economic Research; 2015 Oct [cited 2019 Jan 25]. (NBER Working Paper No. 21632).Availablefrom:https://www .nber.org/papers/w21632.pdf 8 Medical Group Management Association [Internet]. Englewood (CO): MGMA; 2018. Press release, New MGMA data shows medical practices utilizing more non-physician providers are more profitable, productive; 2018 Jul [cited 2019 Jan 25]. Available from: https://www.mgma .com/news-insights/press/newmgma-data-shows-medicalpractices-utilizing-mo 9 The current schedule of reductions to Medicaid disproportionate share hospital payments was most recently modified by the Bipartisan Budget Act of 2018. 10 Mercer. Mercer annual survey finds health benefit cost growth will hold at4.1%in2019[Internet].NewYork (NY): Mercer; 2018 Sep 12 [cited 2019 Jan 25]. Available from: https://www.mercer.com/ newsroom/mercer-annual-surveyfinds-health-benefit-cost-growthwill-hold-at-41-in-2019.html 11 The net cost of insurance is the difference between total private health insurance spending and benefits incurred. It includes administrative costs, taxes, net gains or losses to reserves, and profits.
12 Fehr R, Cox C, Levitt L. Individual insurance market performance in mid-2018 [Internet]. San Francisco (CA): Henry J. Kaiser Family Foundation; 2018 Oct 5 [cited 2019 Jan 25]. Available from: https://www .kff.org/health-reform/issue-brief/ individual-insurance-marketperformance-in-mid-2018/ 13 Claxton G, Rae M, Long M, Damico A, Whitmore H. Health benefits in 2018: modest growth in premiums, higher workercontributions at firms with more low-wage workers. Health Aff (Millwood). 2018;37(11): 1892–900. 14 Inresponsetotheexcisetaxonhighcost insurance plans, some employers are expected to reduce the value of their health insurance benefits to remain below tax thresholds, which would result in higher cost sharing for employees. 15 Food and Drug Administration, Center for Drug Evaluation and Research. Advancing health through innovation: 2018 new drug therapy approvals [Internet]. Silver Spring (MD):FDA;2019Jan[cited2019Jan 25]. Available from: https://www .fda.gov/downloads/Drugs/ DevelopmentApprovalProcess/ DrugInnovation/UCM629290.pdf 16 IQVIA. 2018 and beyond: outlook andturningpoints.Parsippany(NJ): IQVIA; 2018 Mar 13. 17 EvaluatePharma. World preview 2018, outlook to 2024 [Internet]. London: EvaluatePharma; 2018 Jun [cited 2019 Jan 25]. Available from:
http://info.evaluategroup.com/rs/ 607-YGS-364/images/WP2018.pdf 18 Evans M. U.S. hospital profits fall as labor costs grow and patient mix shifts.Wall Street Journal [serial on the Internet]. 2018 Apr 23 [cited 2019 Jan 25]. Available from: https://www.wsj.com/articles/u-shospital-profits-fall-as-labor-costsgrow-and-patient-mix-shifts1524495601 19 Garten R, Blanton L, Elal AIA, Alabi N, Barnes J, Biggerstaff M, et al. Update: influenza activity in the United States during the 2017–18 season and composition of the 2018–19 influenza vaccine. MMWR Morb Mortal Wkly Rep. 2018; 67(22):634–42. 20 Dall T, West T, Chakrabati R, Reynolds R, Iacobucci W. 2018 update: the complexities of physician supply and demand: projections from 2016 to 2030: final report [Internet].Washington (DC): IHS Markit; 2018 Mar [cited 2019 Jan 25]. Available from: https://aamcblack.global.ssl.fastly.net/ production/media/filer_public/85/ d7/85d7b689-f417-4ef0-97fbecc129836829/aamc_2018_ workforce_projections_update_ april_11_2018.pdf 21 Hoffman M. Can nurse practitioners fill the void in primary care? MD [serial on the Internet]. 2018 Apr 19 [cited 2019 Jan 25]. Available from: https://www.mdmag.com/medicalnews/can-nurse-practitioners-fillthe-void-in-primary-care
March 2019 38:3 Health A
Democrats defeated Republicans in the Obamacare repeal fight by warning that 22 million Americans would be thrown off their health insurance. They pointed to data leaked from the Congressional Budget Office.
Well, it turns out that data was completely wrong.
According to a report [a paywalled paper, https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2018.05499] by the Centers for Medicare and Medicaid Services released Wednesday, the Congressional Budget Office wildly overestimated the number of people who would lose their health insurance with the repeal of the individual mandate penalty.
Initial estimates from the Congressional Budget Office said 14 million would drop off their health insurance coverage due to the elimination of the individual mandate. Then, during the height of the 2017 debate over repeal, progressives touted a leaked number from the Congressional Budget Office claiming that 22 million people would “lose” their insurance if Congress repealed the law.
However, as health care analyst Avik Roy pointed out (https://www.forbes.com/sites/theapothecary/2017/07/22/cbo-three-fourths-of-coverage-difference-between-obamacare-gop-bills-driven-by-individual-mandate/#320be2c63627
), what made this number so high was the inflated number of people expected to lose their insurance due to repeal of the mandate—about 73 percent to be exact. So, it wouldn’t be 22 million Americans losing their insurance. Most of those in the projection would simply be choosing to opt out of insurance.
And it turns out even that wasn’t true. A far smaller number of Americans appear to be opting out of insurance since the individual mandate’s repeal. Only 2.5 million more people are expected to go without insurance in 2019 due to its repeal, according to the latest report, and that number is expected to decline in the years ahead.
[...]
The Congressional Budget Office is opaque, to say the least. It does not publish or share the way it comes up with numbers, and some have criticized the organization for its lack of transparency and outsized influence on policymaking.
Doug Badger, a visiting fellow in domestic policy studies at The Heritage Foundation, told The Daily Signal that Congressional Budget Office analysis has been a chronic problem.
“When it comes to the individual mandate, CBO has never let the facts affect their wildly inaccurate estimates. CBO continued to forecast that millions of insured Americans would suddenly become uninsured if the mandate were repealed,” Badger wrote in an email to The Daily Signal. “CBO’s faulty estimates misled the public into believing that repealing Obamacare would lead to a vast increase in the number of uninsured. Bad estimates produced bad policy.”
[...]
---
the paywalled paper:
National Health Expenditure Projections, 2018–27: Economic And Demographic Trends Drive Spending And Enrollment Growth. By Andrea M. Sisko, Sean P. Keehan, John A. Poisal, Gigi A. Cuckler, Sheila D. Smith, Andrew J. Madison, Kathryn E. Rennie, and James C. Hardesty
doi: 10.1377/hlthaff.2018.05499
ABSTRACT National health expenditures are projected to grow at an average annual rate of 5.5 percent for 2018–27 and represent 19.4 percent of gross domestic product in 2027. Following a ten-year period largely influenced by the Great Recession and major health reform, national health spending growth during 2018–27 is expected to be driven primarily by long-observed demographic and economic factors fundamental to the health sector. Prices for health care goods and services are projected to grow 2.5 percent per year, on average, for 2018–27—faster than the average price growth experienced over the last decade—and to account for nearly half of projected personal health care spending growth. Among the major payers, average annual spending growth in Medicare (7.4 percent) is expected to exceed that in Medicaid (5.5 percent) and private health insurance (4.8 percent) over the projection period, mostly as a result of comparatively higher projected enrollment growth. The insured share of the population is expected to remain stable at around 90 percent throughout the period, as net gains in health coverage from all sources are projected to keep pace with population growth.
-
During 2018–27 national health spendingisexpectedtobedriven primarily by long-observed demographic and economic factors fundamentaltothehealthsector, largely in contrast to the prior decade—which was affected by the notable impacts of a historic recessionand the implementation of wide-ranging health reform legislation.1 Overall, national health spending is projected to grow at 5.5 percentperyear,onaverage,for2018–27(exhibit1). This is faster than the average growth rate experiencedfollowingthelastrecession(3.9percent for 2008–13) and the more recent period inclusive of the Affordable Care Act’s major coverage expansions(5.3percentfor2014–16).However, it is slower than the rate throughout the nearly two decades preceding the Great Recession (7.3 percent for 1990–2007). Growth in gross domesticproduct(GDP)duringtheten-yearprojectionperiodisprojectedtoaverage4.7percent. Because national health spending growth is expectedtoincrease0.8percentagepointfaster, onaverage,thangrowthinGDPovertheprojection period, the health share of GDP is expected to rise from 17.9 percent in 2017 to 19.4 percent in 2027, with almost all of the increase in share expected after 2020. Projected average annual spending growth rates for the underlying major payers of health care are expected to vary substantially during 2018–27,mainlyasaresultofdifferingexpected trends in enrollment growth. Average Medicare spendinggrowthisprojectedtobethefastest,at
doi: 10.1377/hlthaff.2018.05499 HEALTH AFFAIRS 38, NO. 3 (2019): – ©2019 Project HOPE— The People-to-People Health Foundation, Inc.
Andrea M. Sisko (Andrea .Sisko@cms.hhs.gov) is an economist in the Office of the Actuary, Centers for Medicare and Medicaid Services (CMS), in Baltimore, Maryland.
Sean P. Keehan is an economist in the CMS Office of the Actuary.
John A. Poisal is a deputy director of the National Health Statistics Group, CMS Office of the Actuary.
Gigi A. Cuckler is an economist in the CMS Office of the Actuary.
Sheila D. Smith is an economist in the CMS Office of the Actuary.
Andrew J. Madison is an actuary in the CMS Office of the Actuary.
Kathryn E. Rennie is an actuary in the CMS Office of the Actuary.
James C. Hardesty is an actuary in the CMS Office of the Actuary.
March 2019 38:3 Health Affairs 1
Costs & Spending
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Exhibit 1
National health expenditures(NHE),aggregateand percapitaamounts,shareofgross domesticproduct(GDP), andaverageannualgrowthfromprevious year shown, by source of funds, selected calendar years 2013–27
Source of funds 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions NHE $2,881.8 $3,361.1 $3,492.1 $3,646.9 $3,823.1 $5,963.2 Health consumption expenditures 2,728.6 3,202.9 3,324.5 3,470.3 3,637.6 5,679.9 Out of pocket 325.9 356.1 365.5 378.6 396.9 585.8 Health insurance 2,088.1 2,504.5 2,604.2 2,720.9 2,850.6 4,545.8 Private health insurance 947.1 1,136.4 1,183.9 1,237.7 1,278.2 1,896.7 Medicare 589.9 677.1 705.9 747.4 800.1 1,436.8 Medicaid 445.2 565.6 581.9 594.8 623.4 992.1 Federal 256.9 358.3 361.2 369.5 386.5 611.1 State and local 188.4 207.3 220.6 225.3 237.0 380.9 Other health insurance programsc 105.9 125.3 132.6 141.0 148.8 220.2 Other third-party payers and programs and public health activity 314.7 342.4 354.8 370.8 390.0 548.4 Investment 153.2 158.2 167.6 176.5 185.5 283.3 Population (millions) 315.7 322.9 325.2 327.9 330.7 352.7 GDP, billions $16,784.9 $18,707.2 $19,485.4 $20,498.6 $21,503.1 $30,755.4 Disposable personal income, billions 12,505.3 14,170.9 14,796.3 15,563.2 16,297.3 23,453.9 NHE per capita 9,128.9 10,410.1 10,739.1 11,121.2 11,559.3 16,907.0 GDP per capita 53,170.5 57,941.2 59,922.8 62,511.0 65,015.9 87,198.3 Prices (2012=100.0) Personal Health Care Price Index 1.015 1.049 1.062 1.081 1.101 1.359 GDP Implicit Price Deflator, chain weighted 1.018 1.059 1.079 1.104 1.130 1.344 NHE as percent of GDP 17.2% 18.0% 17.9% 17.8% 17.8% 19.4% Annual growth NHE 3.9% 5.3% 3.9% 4.4% 4.8% 5.7% Health consumption expenditures 4.0 5.5 3.8 4.4 4.8 5.7 Out of pocket 2.0 3.0 2.6 3.6 4.8 5.0 Health insurance 4.4 6.2 4.0 4.5 4.8 6.0 Private health insurance 3.4 6.3 4.2 4.5 3.3 5.1 Medicare 5.3 4.7 4.2 5.9 7.1 7.6 Medicaid 5.3 8.3 2.9 2.2 4.8 6.0 Federal 5.6 11.7 0.8 2.3 4.6 5.9 State and local 5.0 3.2 6.4 2.1 5.2 6.1 Other health insurance programsc 6.0 5.8 5.8 6.4 5.5 5.0 Other third-party payers and programs and public health activity 3.4 2.9 3.6 4.5 5.2 4.4 Investment 1.7 1.1 6.0 5.3 5.1 5.4 Populationd 0.8 0.8 0.7 0.8 0.9 0.8 GDP 2.5 3.7 4.2 5.2 4.9 4.6 Disposable personal income 2.9 4.3 4.4 5.2 4.7 4.7 NHE per capita 3.0 4.5 3.2 3.6 3.9 4.9 GDP per capita 1.7 2.9 3.4 4.3 4.0 3.7 Prices (2012=100.0) Personal Health Care Price Index 2.2 1.1 1.3 1.7 1.9 2.7 GDP Implicit Price Deflator, chain weighted 1.6 1.3 1.9 2.3 2.3 2.2
SOURCES Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group; and Department of Commerce, Bureau of Economic Analysis and Bureau of the Census. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017: definitions, sources, and methods [Internet]. Baltimore (MD): Centers for Medicare and Medicaid Services; [cited 2019 Jan 25]. Available from: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/dsm-17.pdf. Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables [Internet]. Baltimore (MD): Centers for Medicare and Medicaid Services; 2019 [cited 2019 Feb 20]. Available from: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/Proj2018Tables.zip. aAnnual growth, 2008–13. bProjected. cIncludes health-related spending for Children’s Health Insurance Program (CHIP), Titles XIX and XXI; Department of Defense; and Department of Veterans Affairs. dEstimates reflect the Bureau of the Census’s definition of resident-based population (which includes all people who usually reside in the fifty states or the District of Columbia but excludes residents living in Puerto Rico and areas under US sovereignty, and US Armed Forces overseas and US citizens whose usual place of residence is outside of the United States). Estimates also include a small (typically less than 0.2 percent of population) adjustment to reflect census undercounts. Projected estimates reflect the area population growth assumptions found in the 2018 Medicare Trustees Report (see note 4 in text).
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7.4 percent per year, as the shift of the babyboom generation into the program continues toresultinrobustgrowthinenrollment(2.5percent per year, on average) (exhibit 2). This shift also contributes to comparatively slower projected private health insurance enrollment growth of just 0.2 percent per year in 2018–27 and underlies the expectation that growth in private health insurance spending will be the slowest among the payers, at just 4.8 percent peryear,onaverage.Medicaidspendinggrowth is expected to be 5.5 percent, on average, with projected enrollment growth of 1.3 percent per year during this period. Per enrollee, rates of growth in spending for Medicare, Medicaid, and private health insurance are expected to be somewhat similar over the ten-year projection period (4.7 percent,
4.1percent,and4.6percentperenrollee,respectively). However, these averages mask the unique year-to-year trends among the major payersthatareinfluencedbyregulation,legislation, and economic factors—each of which is discussed in more detail below. For 2018, national health spending is projected to have grown by 4.4 percent, following a rate of 3.9 percent in 2017 (exhibit 1).1 Faster projected spending growth of almost 2 percentage points in Medicare (5.9 percent) primarily contributes to the acceleration that reflectshigherexpectedgrowthforbothhospital services and prescription drugs. However, Medicaid spending growth is projected to have slowed by 0.7 percentage point in 2018 (to 2.2 percent), as enrollment growth is expected to have slowed for the fourth consecutive year.
Exhibit 2
National health expenditures (NHE) and health insurance enrollment, aggregate and per enrollee amounts, and average annual growth from previous year shown, by source of funds, selected calendar years 2013–27
Source of funds 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions Private health insurance $947.1 $1,136.4 $1,183.9 $1,237.7 $1,278.2 $1,896.7 Medicare 589.9 677.1 705.9 747.4 800.1 1,436.8 Medicaid 445.2 565.6 581.9 594.8 623.4 992.1 Annual growth in expenditure Private health insurance 3.4% 6.3% 4.2% 4.5% 3.3% 5.1% Medicare 5.3 4.7 4.2 5.9 7.1 7.6 Medicaid 5.3 8.3 2.9 2.2 4.8 6.0 Per enrollee spending Private health insurance $ 5,052 $ 5,771 $ 6,001 $ 6,269 $ 6,511 $ 9,384 Medicare 11,503 12,144 12,347 12,726 13,240 19,546 Medicaid 7,553 7,944 8,013 8,099 8,289 12,029 Annual growth in per enrollee spending Private health insurance 4.3% 4.5% 4.0% 4.5% 3.9% 4.7% Medicare 2.4 1.8 1.7 3.1 4.0 5.0 Medicaid 0.9 1.7 0.9 1.1 2.4 4.8 Enrollment, millions Private health insurance 187.5 196.9 197.3 197.4 196.3 202.1 Medicare 51.3 55.8 57.2 58.7 60.4 73.5 Medicaid 58.9 71.2 72.6 73.4 75.2 82.5 Uninsured 44.1 28.7 29.7 29.9 31.2 36.2 Population 315.7 322.9 325.2 327.9 330.7 352.7 Insured share of total population 86.0% 91.1% 90.9% 90.9% 90.6% 89.7% Annual growth in enrollment Private health insurance −0.9% 1.7% 0.2% 0.1% −0.6% 0.4% Medicare 2.9 2.8 2.5 2.7 2.9 2.5 Medicaid 4.4 6.5 2.0 1.1 2.4 1.2 Uninsured 1.2 −13.4 3.7 0.7 4.3 1.9 Population 0.8 0.8 0.7 0.8 0.9 0.8
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017 (see exhibit 1 notes). Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables (see exhibit 1 notes). aAnnual growth, 2008–13. bProjected.
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Fromtheperspectiveofoverallhealthinsurance enrollment,netgainsinhealthinsurancecoverage across all sources are expected to have kept pacewithoverallpopulationgrowth.Asaresult, the insured share of the population is projected to have remained stable at 90.9 percent. For 2019, growth in national health spending is expected to increase again to 4.8 percent (exhibit 1). Medicare spending growth is projected to continue accelerating (to 7.1 percent), partlyas aresultof fastergrowth inperenrollee spending attributable to higher fee-for-service payment updates. Growth in Medicaid expenditures is also expected to rise (to 4.8 percent), in partbecauseofexpansionsofMedicaidcoverage in Idaho, Maine, Nebraska, Utah, and Virginia. A somewhat mitigating influence on overall national health spending growth, however, is the expected impact of the repeal of the individual mandate. The repeal is expected to result in lowerprivatehealthinsuranceenrollment,since some people—particularly those with directpurchase insurance—may elect to forgo coverage.2,3 Combined,theseshiftsinenrollmentlead to a projected net increase in the number of uninsured of 1.3 million people, to 31.2 million in2019(exhibit 2). However,projectedgains in enrollment through other sources are expected to partially offset those declines, resulting in only a slight decrease in the insured share of the population (to 90.6 percent in 2019, from 90.9 percent in 2018). For2020–27,growthinnationalhealthspendingisexpectedtoaverage5.7percent.Thisrateis fasterthanprojectedfor2019,andfastergrowth is generally evident for the underlying major payers and health care services and goods (exhibits 1 and 3). The acceleration is in part duetofastergrowthinpersonalhealthcarepricesasmeasuredbythePersonalHealthCarePrice Index (exhibit 1). Also contributing is increasingly higher expected growth in utilization on thepartofMedicarebeneficiariesandthosewith privatehealthinsurance,thelatterinfluencedby a lagged response to comparatively higher income growth during 2020–22. With respect to insurance coverage over 2020–27, growth in employer-sponsored health insurance enrollmentis projected to bebelow thatof population growth and decline for those purchasing insurance directly, which contributes to a slight decline in the insured share of the population to 89.7 percent by 2027 (exhibit 2). The share of health care spending sponsored (orfinanced)byfederal,state,andlocalgovernments is expected to increase by 2 percentage points during 2018–27, reaching 47 percent by 2027 (exhibit 4). The increase is entirely accounted for by the federal government share,
which is expected to grow from 28 percent in 2017 to 31 percent in 2027, and largely reflects fastergrowth inMedicare spending as the babyboomgenerationcontinuestotransitionintothe program. The expected business and household share is expected to fall from 55 percent in 2017 to 53 percent in 2027.
Model And Assumptions The national health expenditure projections incorporate a combination of actuarial and econometricmodelingmethods,aswellasjudgments about future events and trends that are expectedtoinfluencehealthspending.3 Theyare largely based on economic and demographic assumptions in the 2018 Medicare Trustees Report,4updatedtoreflectmorerecentlyreleased macroeconomic data.3 The projections also reflect current law5 and do not reflect any policy proposals currently under consideration. Estimates of future health care spending and enrollment are inherently subject to substantial uncertainty that increases over the projection horizon. In addition to the potential effects of evolvinghealthcaremarketsandchangesinlaw over time, economic conditions can differ from the intended midrange assumptions used here. In the case of one economic variable, disposable personal income, analysis by the Office of theActuaryhasconsistentlyfoundarelationship between growth in that metric and growth in health spending, especially for private health insurance.3 That is, as income growth increases or decreases, health spending growth tends to follow in the same direction, but with a lag. Thisrelationshiphasbeenevidentoverthefull history of the National Health Expenditure Accounts and is reflected in these projections.3 As a result, with faster growth in income assumed for the coming decade relative to the recent past, it is expected that health spending growth will respond and be higher as well.3 The projections presented here reflect this relationship. Thus, to the extent that actual growth in income differs from what is assumed, actual growthinhealthspendingmaydifferfromwhat is projected.
Factors Accounting For Growth Inexhibit5averageannualpersonalhealthcare spending6growthisdecomposedtodemonstrate the relative contributions of underlying price growth (economywide and relative personal health care price inflation), use and intensity, population growth, and age-sex mix. During 2018–27 personal health care spending growth is expected to average 5.5 percent, with growth
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in personal health care prices expected to account for nearly half of that growth, on average. Growth in use and intensity is expected to account for just under one-third of the average annual personal health care spending growth, with population growth and the changing age-sex mix of the population accounting for
the remainder. Over specific years within the projection period, however, there are notable trends in prices and the volume and intensity of services, some of which are anticipated to contrast with recent experience. Inflationforhealthcaregoodsandservices,as measured by the Personal Health Care Price
Exhibit 3
National health expenditures (NHE) amounts and annual growth from previous year shown, by spending category, selected calendar years 2013–27
Spending category 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions NHE $2,881.8 $3,361.1 $3,492.1 $3,646.9 $3,823.1 $5,963.2 Health consumption expenditures 2,728.6 3,202.9 3,324.5 3,470.3 3,637.6 5,679.9 Personal health care 2,438.0 2,851.9 2,961.0 3,085.3 3,242.5 5,058.4 Hospital care 937.6 1,092.8 1,142.6 1,193.4 1,254.7 1,961.6 Professional services 759.4 884.0 920.0 962.8 1,013.6 1,541.2 Physician and clinical services 569.6 666.5 694.3 728.0 767.6 1,172.0 Other professional services 78.7 92.4 96.6 100.8 106.1 165.3 Dental services 111.1 125.1 129.1 134.0 139.9 203.9 Other health, residential, and personal care 144.3 173.4 183.1 188.4 196.9 318.6 Home health care 81.4 93.1 97.0 101.8 108.8 186.8 Nursing care facilities and continuing care retirement communities 149.0 163.0 166.3 170.8 178.0 270.7 Retail outlet sales of medical products 366.3 445.6 451.9 468.1 490.5 779.4 Prescription drugs 265.2 332.0 333.4 344.5 360.3 576.7 Durable medical equipment 45.1 51.0 54.4 57.4 60.9 97.8 Other nondurable medical products 56.0 62.7 64.1 66.2 69.3 105.0 Government administration 37.4 44.7 45.0 46.7 49.4 81.0 Net cost of health insurance 174.2 220.7 229.5 247.2 252.0 417.3 Government public health activities 79.1 85.6 88.9 91.1 93.6 123.2 Investment 153.2 158.2 167.6 176.5 185.5 283.3 Noncommercial research 46.7 47.6 50.7 53.5 56.2 83.3 Structures and equipment 106.5 110.6 116.9 123.1 129.3 200.0 Annual growth NHE 3.9% 5.3% 3.9% 4.4% 4.8% 5.7% Health consumption expenditures 4.0 5.5 3.8 4.4 4.8 5.7 Personal health care 4.1 5.4 3.8 4.2 5.1 5.7 Hospital care 5.2 5.2 4.6 4.4 5.1 5.7 Professional services 3.6 5.2 4.1 4.7 5.3 5.4 Physician and clinical services 3.7 5.4 4.2 4.9 5.4 5.4 Other professional services 4.6 5.5 4.6 4.3 5.3 5.7 Dental services 2.2 4.0 3.2 3.8 4.4 4.8 Other health, residential, and personal care 4.9 6.3 5.6 2.9 4.5 6.2 Home health care 6.0 4.6 4.3 4.9 6.8 7.0 Nursing care facilities and continuing care retirement communities 3.0 3.0 2.0 2.7 4.2 5.4 Retail outlet sales of medical products 2.2 6.8 1.4 3.6 4.8 6.0 Prescription drugs 2.0 7.8 0.4 3.3 4.6 6.1 Durable medical equipment 3.3 4.2 6.8 5.5 6.1 6.1 Other nondurable medical products 2.7 3.8 2.2 3.3 4.7 5.3 Government administration 4.2 6.1 0.5 3.9 5.7 6.4 Net cost of health insurance 3.3 8.2 4.0 7.7 2.0 6.5 Government public health activities 3.1 2.7 3.9 2.4 2.8 3.5 Investment 1.7 1.1 6.0 5.3 5.1 5.4 Noncommercial research 1.5 0.7 6.5 5.4 5.1 5.0 Structures and equipment 1.8 1.3 5.7 5.3 5.1 5.6
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017 (see exhibit 1 notes). Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables (see exhibit 1 notes). aAnnual growth, 2008–13. bProjected.
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Index and inclusive of both economywide and relative personal health care price inflation, is projected to play a larger role in the coming decade (averaging growth of 2.5 percent per year for 2018–27, compared to 1.1 percent for 2014–17)andaccountfornearlyhalfofpersonal health care spending growth. This expectation reflects accelerating growth in both economywide inflation and relative personal health care price inflation (or the difference between price growth for personal health care goods and servicesand economywideinflation).Theexpected acceleration in growth in economywide prices occurredprimarily in 2018. From 2019 forward, asteadyincreaseinrelativepersonalhealthcare priceinflationisprojected,ascertainfactorsthat
contributedtolowornegativegrowthinrelative personal health care price inflation since 2011 are anticipated to be less influential in restraining prices over the next decade. Such factors includerisingsensitivitytopricesbyconsumers and insurers, especially for services subject to cost sharing;7 selective contracting by insurers; and improvements in productivity through the useoflower-costprovidersinphysicianoffices.8 Similarly, input price growth, including healthsector wages, is expected to accelerate as downward pressure on provider prices lessens. The average growth rate for use and intensity of services is projected to be 1.7 percent over 2018–27 and to account for about 30 percent ofpersonalhealthcarespendinggrowth(exhib
Exhibit 4
National healthexpenditures(NHE) amounts,average annualgrowthfromprevious yearshown, and percentdistribution, by type of sponsor, selected calendar years 2013–27
Type of sponsor 2013a 2016 2017 2018b 2019b 2027b Expenditure, billions NHE $2,881.8 $3,361.1 $3,492.1 $3,646.9 $3,823.1 $5,963.2 Businesses, household, and other private revenues 1,620.6 1,836.7 1,914.1 2,002.9 2,095.2 3,136.4 Private businesses 580.4 669.1 696.5 730.9 765.1 1,123.2 Household 833.0 942.8 978.6 1,019.9 1,064.1 1,619.3 Other private revenues 207.2 224.7 239.0 252.0 266.0 393.9 Governments 1,261.2 1,524.4 1,577.9 1,644.0 1,727.9 2,826.8 Federal government 752.7 952.4 982.4 1,032.7 1,089.7 1,833.8 State and local governments 508.5 572.0 595.5 611.2 638.2 993.0 Annual growth NHE 3.9% 5.3% 3.9% 4.4% 4.8% 5.7% Businesses, household, and other private revenues 2.8 4.3 4.2 4.6 4.6 5.2 Private businesses 2.3 4.9 4.1 4.9 4.7 4.9 Household 3.1 4.2 3.8 4.2 4.3 5.4 Other private revenues 3.3 2.7 6.4 5.4 5.6 5.0 Governments 5.3 6.5 3.5 4.2 5.1 6.3 Federal government 6.1 8.2 3.2 5.1 5.5 6.7 State and local governments 4.2 4.0 4.1 2.6 4.4 5.7 Distribution NHE 100% 100% 100% 100% 100% 100% Businesses, household, and other private revenues 56 55 55 55 55 53 Private businesses 20 20 20 20 20 19 Household 29 28 28 28 28 27 Other private revenues 7 7 7 7 7 7 Governments 44 45 45 45 45 47 Federal government 26 28 28 28 29 31 State and local governments 18 17 17 17 17 17
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES For definitions, sources, and methods for NHE categories, see CMS.gov. National Health Expenditure Accounts: methodology paper, 2017 (see exhibit 1 notes). Numbers might not add to totals because of rounding. Percent changes are calculated from unrounded data. Tables with data for all years of the projection period can be found at CMS.gov. NHE projections 2018–27—tables (see exhibit 1 notes). aAnnual growth, 2008–13. bProjected.
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it5).Thisresultcontrastswiththerateobserved during the years immediately following the implementation of the coverage expansions under theAffordableCareAct(2014–16),whenuseand intensity was the dominant driver of personal health care spending growth—representing 2.9 percentage points, or just over half, of the average spending growth rate of 5.4 percent. Initially, these increases were largely influenced by expanding enrollment, followed by faster per enrollee spending growth that likely reflected care provided to the newly insured. Unlike that unique time period, during 2018–27 growth in the use and intensity of medical care isprimarilyinfluencedbytheanticipatedeffects of macroeconomic growth consistent with the longer-run historical relationship.
Outlook For Spending And Enrollment By Payer Medicare Medicare spending growth is projected to have increased 5.9 percent in 2018, compared to 4.2 percent in 2017 (exhibit 1), mainly because of faster per enrollee spending growth(3.1percentin2018versus1.7percentin 2017) (exhibit 2). Increases in Medicare private health plan payments, as well as spending for fee-for-service hospital care and prescription
drugs, underlie the projected acceleration. In 2019 Medicare spending is projected to increase by 7.1 percent, a 1.2-percentage-point acceleration over growth in 2018. Increases in fee-for-servicepaymentratescomparedto2018, along with slightly faster growth in the use and intensity of physician and clinical services, contribute to faster expected growth in perenrollee spending, which is projected to rise to 4.0 percent. Additionally, projected Medicare enrollment growth reaches its peak at 2.9 percent in 2019, up from 2.7 percent in 2018. Over 2020–27 Medicare spending growth is expected to remain highest among the payers, averaging 7.6 percent. Compared to the 7.1 percent increase projected for 2019, this faster average growth is primarily driven by an expectation of a continued rebound in growth in the useandintensityofservicesusedthroughoutthe period that is more consistent with the program’s long-term experience, compared to that of the past decade. By the end of the projection period (2026–27) the expected growth rate decelerates to around 7.0 percent, down from a projection-period peak of 8.1 percent in 2022, as slower increases in input prices— including for hospitals—and anticipated faster multifactor productivity growth lead to smaller payment updates for many Part A services. En
Exhibit 5
Factors accounting for growth in personal health care (PHC) expenditures, selected calendar years 1990–2027
SOURCES Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group; and Department of Commerce, Bureau of Economic Analysis and Bureau of the Census. NOTES “Relative PHC inflation” represents the share of medical price growth that exceeds economywide inflation. “Economywide inflation” reflects the gross domestic product deflator index. “Use and intensity” includes quantity and mix of services. As a residual, this factor also includes any errors in measuring prices or total spending. “Age-sex mix” refers to that mix in the population. Growth in the total PHC Price Index is equal to the sum of economywide and relative PHC inflation and is a chain-weighted index of the price for all personal health care deflators. The height of the bars reflects the sum of factors that contribute positively to growth. In those cases where a factor may contribute growth of less than zero, the net total growth is reflected by the line and associated point estimate noted for each period.
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rollmentgrowthisalsoanticipatedtoslowgradually during these years, from 2.8 percent in 2020to2.1percentby2027—aratemoreconsistent with the pre-baby-boom period. By the end of the projection period the Medicare share of total health spending is projected to rise to 24.1 percentby 2027 from 20.2 percentin 2017. Medicaid Medicaid spending growth is expected to have been just 2.2 percent in 2018, down from 2.9 percent growth in 2017 (exhibit 1)—the fourth consecutive year of slowing growth following the ACA’s expansion of Medicaid coverage in 2014. The expected trend in2018,asinprioryears,isprincipallyexplained by slower growth in enrollment, which is projected to have slowed to 1.1 percent in 2018 from 2.0 percent the previous year (exhibit 2). While growth for nearly all Medicaid services is expected to have slowed in 2018, growth in the net cost for Medicaid managed care plans is expected to have rebounded, compared to a decline in growth in 2017. This pattern reflects the historical and projected timeline over which the federal government is recovering payments from managed care organizations as a result of favorable prior-period experience.1 Growth in Medicaid spending is expected to acceleratein2019to4.8percent.Fiveadditional states have approved and are expected to implement Medicaid expansion in 2019, a factor that contributes in part to the aggregate spending growthincrease.ProjectedMedicaidenrollment growth—2.4percentin2019comparedto1.1percentin2018—reflectsthisnewlyeligiblepopulation. Growth in per enrollee Medicaid spending is expected to accelerate, as well, by 1.3 percentage points to 2.4 percent in 2019, as a result of faster growth in price factors. Medicaid spending is expected to grow at an average rate of 6.0 percent over 2020–27. The patterninannualgrowth,however,isinfluenced byreductionstodisproportionatesharehospital payments for hospitals set in law.9 These payments are scheduled to be reduced in 2020 and are then further reduced in 2021. Consequently, Medicaid spending growth is expected to grow slowly at 5.0 percent in 2020 and 5.4 percent in 2021. For 2022 through 2025, when the disproportionate share hospital payment reductions are equivalent to 2021, overall Medicaid spending growth is expected to be higher at 6.1 percent. Beginning in 2026 there are no reductions in the disproportionate share hospital payments,whichleadstoanotableexpectedoneyear acceleration in 2026 for overall Medicaid spending growth to 7.0 percent. Otherwise, an enrollment mix more heavily influenced by spendingpatternsofcomparativelymoreexpensive aged and disabled beneficiaries is expected
to result in per enrollee spending growth that is at or above 5 percent in every year during 2022–27. Private Health Insurance And Out-OfPocket Spending For private health insurance spending, growth is expected to have increased slightlyfrom4.2percentin2017to4.5percentin 2018, near the overall growth rate for national health expenditures of 4.4 percent (exhibit 1). While spending for most services and goods is expected to have grown slightly faster in 2018,10 the acceleration was partially offset by slower projectedgrowthinthenetcostofprivatehealth insurance,11 as private insurers offering plans in the Marketplace had fared better financially in 2017 and thus reduced the difference between premium revenues and expected benefit payments.12 Out-of-pocket spending growth is expected to have accelerated to 3.6 percent in 2018 from 2.6 percent in 2017, a rate that is consistent with faster income growth as well as with the higher average deductibles for employer-based private health insurance enrollees in 2018 compared to 2017.13 The projected spending trends in 2019 in part reflect the estimated impact of the effective repeal of the individual mandate. As some people choose to forgo maintaining health insurance, private health insurance enrollment is expected to decline slightly, primarily in the directpurchaseinsurancemarket.Accordingly,private health insurance spending growth is expected to slow to 3.3 percent in 2019 from 4.5 percent in 2018. Conversely, out-of-pocket spending is expected to grow more rapidly,at 4.8 percentin 2019 compared to 3.6 percent in 2018, in part because fewer people have private insurance coverage. Private health insurance spending is expected to grow 5.1 percent per year, on average, for 2020–27. Growth in this spending is projected to peak at 5.4 percent in 2023–24, in lagged response to the high anticipated growth in disposable personal income a few years prior. Private health insurance spending growth is then expected to slow to 4.8 percent by 2027, as income growthgenerallydecelerates.As the payer with the slowest expected growth over the full projection period, the private health insurance shareofnationalhealthspendingisprojectedto fall from 33.9 percent in 2017 to 31.8 percent in 2027. Growth in out-of-pocket spending, which is also primarily influenced by economic factors, isexpectedtobesimilartothatofprivatehealth insurance spending in 2020–27, at 5.0 percent. However, the projection-period peak in growth is expected in 2022 (5.4 percent), the year in which the excise tax on high-cost insurance
Costs & Spending
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plans is scheduled to go into effect.14 By 2027, becausetotalout-of-pocketspendingisexpected to grow more slowly, on average, than health insurance spending (exhibit 1), it is expected to account for a decreasing share of national health spending (9.8 percent in 2027, down from 10.5 percent in 2017).
Outlook For Major Medical Services And Goods Prescription Drugs Following growth of just 0.4 percent in 2017, prescription drug spending isexpectedtohavegrown3.3percentin2018but still be among the slowest-growing health care sectors (exhibit 3). Higher utilization growth is anticipated, compared to the relatively low growth in 2016 and 2017,1 partially driven by anincreaseinthenumberofnewdrugintroductions (fifty-nine in 2018, up from an average of thirty-four during 2016–17).15 In 2019 prescription drug spending growth is projectedtoacceleratefurther,to4.6percent,as a result of higher expected growth in drug utilization(includingfromnewdrugs)andamodest increase in drug price growth. Prescription drug spending is expected to increase, on average, by 6.1 percent per year for 2020–27 (exhibit 3). Contributing to the acceleration in growth during this period is the expectation that the use of prescription drugs will increaseoverthenextseveralyearsasaresultof increasingly robust efforts by employers and insurerstoreduceanybarriersregardingtheuseof maintenance drugs needed to keep their enrolleeswithchronicconditionshealthy.16 Twoother factors contributing to higher expected growth in the use of prescription drugs are the aging of thepopulationandchangestopharmacotherapy guidelines.16 These trends, coupled with faster expected spending increases in lagged response to faster growth in income, result in a peak projected growth rate for prescription drug spending of 6.4 percent in 2023–24. Finally, prescription drug spending growth is expected to rise becauseofashiftintheintensityandmixofdrug usageassociatedwiththemanyprojectscurrently in clinical development that could, over the nextfewyears,resultininnovative,yetmoreexpensive,newdrugsacrosssuchtherapeuticareas as cancer, diabetes, and Alzheimer’s disease.17 Hospitals Hospital spending is expected to have grown similarly in 2018 (4.4 percent) and 2017 (4.6 percent) (exhibit 3). By payer, somewhatslowergrowthinbothMedicaidandprivate healthinsurancehospitalspendingoffsetslightly faster growth in Medicare hospital spending. For2019hospitalspendinggrowthisexpectedto increase to 5.1 percent because of faster growth
in Medicare hospital payment updates and an increaseintheuseofhospitalservicesassociated withnewMedicaidexpansion–relatedenrollees. These increases are somewhat offset by slower expectedgrowthinprivatehealthinsurancehospital spending, which is partially attributable to the repeal of the individual mandate. Over2020–27hospitalspendinggrowthisexpected to average 5.7 percent per year, up from 5.1 percent in 2019. Consistent with overall spending, Medicare is expected to experience the fastest growth in spending for hospital care during this period. The peak growth for overall hospital spending is projected to occur in 2026 (6.1 percent) and is strongly influenced by substantially faster Medicaid spending growth in 2026 that reflects the expiration of Medicaid disproportionate share hospital payment reductions scheduled in current law for September 30, 2025. Private health insurance spending growth for hospital care is expected toreachitsprojection-periodpeakin2024,consistent with the lagged relationship to income. Hospital price growth is also expected to rise by2027.Theaccelerationinthisgrowthoverthe projection period primarily reflects continued wage increases for hospital employees that are anticipated from the low rates of growth experienced following the Great Recession, as well as tighter labor markets for hospital employees, including nurses.18 Growth is partially offset, however, by Medicare payment updates that are reduced by growth in economywide productivity,whichisprojectedtoaccelerateduringthe projection period.4 Physician And Clinical Services Spending in2018forphysicianandclinicalservicesisprojected to have grown 4.9 percent, rising from 4.2 percent in 2017 (exhibit 3). Price growth for physician and clinical services is expected to have increased 0.3 percentage point but to have remained at near historically low rates at 0.7percent.Thiscontinuedlowpricegrowthwas likely influenced, in part, by physician practices using more nonphysicians to provide care, a practicethatwasrelatedtoincreasedproductivity and profits even in the presence of slow price growth.8 The acceleration in overall projected spending growth also reflects faster growth in use that is partly related to a lagged response to growth in income over the recent history and alsofromincreasesinthenumberofofficevisits due to the severe 2017–18 flu season.19 In2019,growthinspendingforphysicianand clinical services is projected to accelerate once more,to5.4percentfrom4.9percentin2018.An accelerationinMedicaidspendinggrowthisthe primary factor contributing to the trend, which is in part associated with program’s expansion
March 2019 38:3 Health Affairs 9
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by additional states. Over the remainder of the projection period, 2020–27, average annual growth in physician and clinical services spending is projected to be 5.4 percent. The growth rate for Medicare spending is expected to be substantially faster than that projected for physician and clinical services spending in private health insurance. Thatprojecteddifferentialislargelyduetofaster enrollment associated with the continued shift ofthebaby-boomgenerationfromprivatehealth insurance to Medicare. Another factor contributing to the growth in overall physician and clinical services spending over 2020–27 is an anticipated acceleration in physicianprice growth.Underlyingthisacceleration are projected rising costs related to the provision of care. In particular, wages are expected to increase as a result of the supply of physicians not being able to meet expected increases in demand for care connected with the aging population.20 Furthermore, some of the productivity gains that have been achieved throughtheuseoflower-costprovidersasasubstitute for physician care within physician practices may be less pronounced in the future, becauseoflimitationssuchaslicensingrestrictions on the scope of care that may be provided by nonphysician providers.21
Conclusion Duringthepasttenyearsthelingeringeffectsof the Great Recession, coupled with the coverage
and payment provisions of the Affordable Care Act, have significantly influenced the trends in healthcarespendingandenrollmentintheUnited States. Over the next decade, however, the outlook for health spending and insurance coverage isexpected to beprimarily drivenby longobserved demographic and economic factors fundamental to the health sector. While the national health spending growth rate is projected to average 5.5 percent per year for 2018–27 (exhibit 1), annual growth is expected to generally accelerate over much of the projection period. Medicare spending growth is expected to accelerate and be the fastest among the major payers, reflecting not only the continued enrollment shift of the baby-boom generationintotheprogrambutalsothegrowthratefor useandintensity,whichisprojectedtogradually increase toward the rates observed during Medicare’s long-term history. Growth in health care prices,reflectingbotheconomywideandrelative personal health care price inflation, is also expected to rebound somewhat toward rates more consistent with the period before the Great Recession and to return to a state in which personal health care price growth exceeds that of economywidepriceinflation.Finally,recentand anticipatedfastergrowthindisposablepersonal income is expected to lead to an increased demand for services, albeit with a lag, and put upwardpressureonthepatternofprivatehealth insurance and out-of-pocket spending growth over the projection period. ▪
The opinions expressed here are the authors’ and not necessarily those of the Centers for Medicare and Medicaid
Services. The authors thank Paul Spitalnic, Stephen Heffler, Aaron Catlin, Micah Hartman, Greg Savord, Cathy
Curtis, and anonymous peer reviewers for their helpful comments. [Published online February 20, 2019. ]
NOTES
1 Martin AB, Hartman M,Washington B, Catlin A, National Health Expenditure Accounts Team. National healthcarespendingin2017:growth slows to post–Great Recession rates; share of GDP stabilizes. Health Aff (Millwood). 2019;38(1):96–106. 2 By 2019 the individual mandate repeal is anticipated to result in about 1.5 million fewer direct-purchasemarket enrollees, who are expected to be somewhat younger and healthier than those who retain coverage, aswellasabout1.0 million fewer employer-sponsoredinsurance-market enrollees, than otherwise would have been projected. After 2019 the enrollment effects are expected to be smaller. Medicaid enrollment is assumed to be unaffected. See Centers for Medicare and Medicaid Services.
Projections of national health expenditures (note 3). 3 Centers for Medicare and Medicaid Services. Projections of national health expenditures: methodology and model specification [Internet]. Baltimore (MD): CMS; 2018 Feb 14 [cited 2019 Feb 4]. Available from: https://www.cms.gov/ResearchStatistics-Data-and-Systems/ Statistics-Trends-and-Reports/ NationalHealthExpendData/ Downloads/Projections Methodology.pdf 4 Boards of Trustees. 2018 annual report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds [Internet]. Baltimore (MD): Centers for Medicare and Medicaid Services; 2018 [cited 2019 Jan 25]. Available from:
https://www.cms.gov/ResearchStatistics-Data-and-Systems/ Statistics-Trends-and-Reports/ ReportsTrustFunds/Downloads/ TR2018.pdf 5 Consistent with the methods employed in the Medicare Trustees Report (see note 4), these projections assume that payments would continue to be made even after the projected depletion of the Medicare Hospital Insurance trust fund, currently projected to occur in 2026. 6 Personal health care expenditures (PHC) measures the total amount spent to treat people with specific medical conditions. It represents about 85 percent of total national health expenditures over the projection period. 7 Brot-Goldberg ZC, Chandra A, Handel BR, Kolstad JT.What does a
Costs & Spending
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deductible do? The impact of costsharing on health care prices, quantities, and spending dynamics [Internet]. Cambridge (MA): National Bureau of Economic Research; 2015 Oct [cited 2019 Jan 25]. (NBER Working Paper No. 21632).Availablefrom:https://www .nber.org/papers/w21632.pdf 8 Medical Group Management Association [Internet]. Englewood (CO): MGMA; 2018. Press release, New MGMA data shows medical practices utilizing more non-physician providers are more profitable, productive; 2018 Jul [cited 2019 Jan 25]. Available from: https://www.mgma .com/news-insights/press/newmgma-data-shows-medicalpractices-utilizing-mo 9 The current schedule of reductions to Medicaid disproportionate share hospital payments was most recently modified by the Bipartisan Budget Act of 2018. 10 Mercer. Mercer annual survey finds health benefit cost growth will hold at4.1%in2019[Internet].NewYork (NY): Mercer; 2018 Sep 12 [cited 2019 Jan 25]. Available from: https://www.mercer.com/ newsroom/mercer-annual-surveyfinds-health-benefit-cost-growthwill-hold-at-41-in-2019.html 11 The net cost of insurance is the difference between total private health insurance spending and benefits incurred. It includes administrative costs, taxes, net gains or losses to reserves, and profits.
12 Fehr R, Cox C, Levitt L. Individual insurance market performance in mid-2018 [Internet]. San Francisco (CA): Henry J. Kaiser Family Foundation; 2018 Oct 5 [cited 2019 Jan 25]. Available from: https://www .kff.org/health-reform/issue-brief/ individual-insurance-marketperformance-in-mid-2018/ 13 Claxton G, Rae M, Long M, Damico A, Whitmore H. Health benefits in 2018: modest growth in premiums, higher workercontributions at firms with more low-wage workers. Health Aff (Millwood). 2018;37(11): 1892–900. 14 Inresponsetotheexcisetaxonhighcost insurance plans, some employers are expected to reduce the value of their health insurance benefits to remain below tax thresholds, which would result in higher cost sharing for employees. 15 Food and Drug Administration, Center for Drug Evaluation and Research. Advancing health through innovation: 2018 new drug therapy approvals [Internet]. Silver Spring (MD):FDA;2019Jan[cited2019Jan 25]. Available from: https://www .fda.gov/downloads/Drugs/ DevelopmentApprovalProcess/ DrugInnovation/UCM629290.pdf 16 IQVIA. 2018 and beyond: outlook andturningpoints.Parsippany(NJ): IQVIA; 2018 Mar 13. 17 EvaluatePharma. World preview 2018, outlook to 2024 [Internet]. London: EvaluatePharma; 2018 Jun [cited 2019 Jan 25]. Available from:
http://info.evaluategroup.com/rs/ 607-YGS-364/images/WP2018.pdf 18 Evans M. U.S. hospital profits fall as labor costs grow and patient mix shifts.Wall Street Journal [serial on the Internet]. 2018 Apr 23 [cited 2019 Jan 25]. Available from: https://www.wsj.com/articles/u-shospital-profits-fall-as-labor-costsgrow-and-patient-mix-shifts1524495601 19 Garten R, Blanton L, Elal AIA, Alabi N, Barnes J, Biggerstaff M, et al. Update: influenza activity in the United States during the 2017–18 season and composition of the 2018–19 influenza vaccine. MMWR Morb Mortal Wkly Rep. 2018; 67(22):634–42. 20 Dall T, West T, Chakrabati R, Reynolds R, Iacobucci W. 2018 update: the complexities of physician supply and demand: projections from 2016 to 2030: final report [Internet].Washington (DC): IHS Markit; 2018 Mar [cited 2019 Jan 25]. Available from: https://aamcblack.global.ssl.fastly.net/ production/media/filer_public/85/ d7/85d7b689-f417-4ef0-97fbecc129836829/aamc_2018_ workforce_projections_update_ april_11_2018.pdf 21 Hoffman M. Can nurse practitioners fill the void in primary care? MD [serial on the Internet]. 2018 Apr 19 [cited 2019 Jan 25]. Available from: https://www.mdmag.com/medicalnews/can-nurse-practitioners-fillthe-void-in-primary-care
March 2019 38:3 Health A
Concept of a Love for Cash is introduced: Physical money worship & strong emotional attachment to it; next to fear of technology, is one of the most important reasons for the resistance to cashless banking
Banking, Unbanking, and New Banking. Dominika Maison. The Psychology of Financial Consumer Behavior pp 185-208, https://link.springer.com/chapter/10.1007/978-3-030-10570-9_6
Abstract: This chapter is dedicated to analysing the psychological factors that support or hinder different levels of banking (having an account, use of a payment card, and use of mobile banking). There are still many people in countries across the world who do not have a bank account or do not use payment cards, which leads to financial exclusion. Apart from the obvious reason for being unbanked resulting from infrastructure limitations (e.g., limited access to bank branches or payment terminals), there are also psychological factors that can affect the level of banking service use. A new model of the levels of banking service use and the results of quantitative and qualitative research are presented in this chapter, revealing the specific nature of functioning on each of the identified levels of banking, along with the psychological barriers relating to moving up banking levels. The barriers to having a bank account and to acceptance of cashless financial behaviours are discussed. A new concept of a Love for Cash is introduced that refers to physical money worship and strong emotional attachment to physical money. Love for Cash, next to fear of technology, was found to be one of the most important reasons for the resistance to cashless banking.
Keywords: Financial exclusion Model of levels of banking service use Love for Cash scale Money worship Cashless financial behaviour
Abstract: This chapter is dedicated to analysing the psychological factors that support or hinder different levels of banking (having an account, use of a payment card, and use of mobile banking). There are still many people in countries across the world who do not have a bank account or do not use payment cards, which leads to financial exclusion. Apart from the obvious reason for being unbanked resulting from infrastructure limitations (e.g., limited access to bank branches or payment terminals), there are also psychological factors that can affect the level of banking service use. A new model of the levels of banking service use and the results of quantitative and qualitative research are presented in this chapter, revealing the specific nature of functioning on each of the identified levels of banking, along with the psychological barriers relating to moving up banking levels. The barriers to having a bank account and to acceptance of cashless financial behaviours are discussed. A new concept of a Love for Cash is introduced that refers to physical money worship and strong emotional attachment to physical money. Love for Cash, next to fear of technology, was found to be one of the most important reasons for the resistance to cashless banking.
Keywords: Financial exclusion Model of levels of banking service use Love for Cash scale Money worship Cashless financial behaviour
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