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Costs cause health spending to slow

Gregory Warner Jan 5, 2010
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Costs cause health spending to slow

Gregory Warner Jan 5, 2010
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Steve Chiotakis: Another report’s already been released today on health care spending for 2008. The journal “Health Affairs” says there was a slowdown, but for reasons you might not think. Here’s Marketplace’s Gregory Warner.


Gregory Warner: In 2008, the health care industry still grew, but at the slowest rate in 50 years.

Joe Antos is with the American Enterprise Institute in Washington.

Joe Antos: In most industries, a 4 percent increase in revenues would be considered a good thing.

But not when it compares to 6 percent the year before. Health care didn’t get any cheaper. Prices stayed the same, but people saw their doctors less. State and local governments tightened Medicaid eligibility and stripped benefits from their programs. While everyone else was cutting back, the federal government was spending more on health care.

JB Silvers of Case Western University says that stimulus money cushioned the recession’s blow.

JB Silvers: And it particularly would have hit children’s hospitals or it would have hit public hospitals certainly that have Medicaid loads.

Health care as a percentage of the national economy rose to over 16 percent.

In Philadelphia, I’m Gregory Warner for Marketplace.

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