Health care spending last year rose at one of the lowest rates in a half-century, partly the result of cost-saving measures put in place by the 2009 health care law, a USA TODAY analysis finds. [...]Both Medicare and Medicaid enrollments have grown, and that actually brings down total health care expenditures (which might be something for policy-makers to think very seriously about in the next round of reform: public health care systems are quite effective in holding down costs). Additionally, prescription prices are falling for some high-use drugs that have lost patent protection and are now available in generic form.
Health care spending hit a record $2.67 trillion last year, but its share of the overall economy shrank, from 17.12% of gross domestic product in 2011 to 17.04%, because other parts of the economy grew faster, an analysis of Bureau of Economic Analysis data found.
Cost-saving measures under the health care law appear to be helping keep medical prices flat, according to health care providers and analysts. Also, weak demand may linger from the recession, which ended in June 2009, especially for optional care such as cosmetic surgery. [...]
"We're beginning a long period of adjustment in health care," says Dan Mendelson. CEO of Avalere Health, which advises health care companies and investors. "Institutions are taking both cost control and quality improvement more seriously."
But a very big driver of the slowdown in costs is the greater scrutiny by regulators on health care providers as Obamacare is implemented, and those providers making adjustments to operate in the new environment: evaluating procedures for effectiveness, finding ways of providing care that's effective and less expensive, like in-home and hospice care rather than nursing homes. The health care industry, at least on the provider side, is taking reform seriously which is forward-thinking. Obamacare, against all odds, passed and withstood legal challenges to become the law of the land. It makes sense for the provider community to make this work and try to avoid bigger, more disruptive reform efforts down the line. Whether that's an incentive that will push the health insurance industry to rein in its practices will be seen soon enough.