Study: Health plan won't up costs much

The cost of health insurance

TEXT OF STORY

BILL RADKE: The question of how much the health care overhaul is going to cost is back again. A new government study published today says -- at least initially -- reform will cost more, but not much more than we're spending right now. It's the conclusion of the first federal health care spending report since reform was passed.

Marketplace's Nancy Marshall Genzer has more.


NANCY MARSHALL GENZER: The report says the new health care law will only add two-tenths of a percent to the nation's health care costs over the next 10 years.

John Poisal is an economist for the government's Centers for Medicare and Medicaid Services, which authored the report. He says government payments to hospitals will be lower because of their improved productivity.

JOHN POISAL: So it effectively will reduce payments to providers by, we estimate roughly 1 percent on average.

But Poisal says in 2014 -- when most provisions of health care reform go into effect -- health care costs will increase sharply. More people will be insured and will take advantage of their benefits. But in 2015, health care inflation is expected be more subdued because of an emphasis on wellness and better patient management.

Ken Thorpe teaches health policy at Emory University.

KEN THORPE: If we really dig in and do a better job of preventing disease and managing chronically ill patients, we'll end up spending less than what's projected here.

Thorpe says chronic diseases are key drivers of health care inflation.

In Washington, I'm Nancy Marshall Genzer for Marketplace.

About the author

Nancy Marshall-Genzer is a senior reporter for Marketplace based in Washington, D.C. covering daily news.

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