Post by unlawflcombatnt on Feb 4, 2009 1:53:20 GMT -6
www.ama-assn.org/amednews/2009/01/19/gvl10119.htm
U.S. health spending tops $2.2 trillion
By Doug Trapp
Jan. 19, 2009.
"National health spending in 2007 grew at its slowest pace since 1998....
Overall health spending increased by only 6.1% in 2007 to reach $2.24 trillion, according to the annual Centers for Medicare & Medicaid Services report, published in the January/February issue of Health Affairs. Health expenditures last dipped below the 6% growth mark in 1998.
Prescription drug spending grew by only 4.9% in 2007....down from an 8.6% growth rate in 2006....
The growth in physician and clinical services spending -- a combined measure of revenues to both doctors and clinics -- held steady between 2006 and 2007....
Growth in national health spending has been slowing since 2002. But spending on physicians alone, which accounts for 80% of this category, saw slightly slower growth in 2007 -- 5.9%....
Spending on most health care services other than prescription drugs grew at the same rate as 2006 or faster....
CMS Chief Actuary Richard S. Foster said that although recent trends have been positive, health spending growth in 2007 was still faster than the rate of inflation and wage growth. In addition, the current rate of generic drug use cannot increase forever....
Overall, growth in national health spending has been slowing since 2002.....
Insurers count their net cost as the difference between premiums they receive and claims they pay....
Medicare fees have an impact
As a subset of total health expenditures, Medicare spending growth on physician and clinical services decelerated to 4.6% in 2007....This drop is due in part to imaging fee cuts in the Deficit Reduction Act of 2005. Growth in spending on doctors also was kept in check by the fact that Congress froze Medicare rates to physicians in 2007.[This is in current dollars, not inflation-adjusted dollars, which means doctors' reimbursements declined in real, inflation adjusted terms, and despite an ~1% increase in the number of patients.]
In approving the 2005 legislation, Congress was attempting to curtail what it saw as overly rapid growth in physician-administered advanced imaging, such as CT and MRI scans. Medicare spending on all physician imaging services doubled between 2000 and 2006, reaching the $14 billion mark in that year, according to a Government Accountability Office report released in September 2008. The deficit reduction law reduced fees in 2007 for administering many physician imaging tests by limiting them to outpatient hospital rates.
Prescription drug spending grew by only 4.9% in 2007,(still more than the cost-of-living) its slowest rate of growth since 1963. The move reduced Medicare per-beneficiary spending on physician imaging between 2006 and 2007 after years of steady increases, according to the GAO report. But the reduced fees did not appear to have the desired effect on imaging utilization, at least not right away. The number of tests performed per beneficiary continued to increase at a rate comparable to prior years. That's because the physicians performing the scans generally aren't the ones ordering them [In other words, they were being ordered by physicians due to increased medical necessity, not due to increased potential financial gain, since the ordering physician made nothing extra by ordering additional testing].....
"Imaging centers and practices away from the hospital aren't buying and updating their equipment like they used to be able to do," he said. They're also taking a hard look at the number of employees they maintain.
Further cuts could lead to facility closures, especially of rural imaging centers, which would force Medicare beneficiaries to travel even farther to receive needed scans, Dr. Allen said.
Given that private insurers typically base many of their rates and coverage decisions on how Medicare sets them, [NO, given that ALL private insurers always base their rates on "how Medicare sets them."] insurers likely followed Medicare's lead and adopted imaging fee cuts of their own, said Benjamin Washington, a CMS statistician....
Also, private health plans are increasing physician fees only slightly, if at all, Washington said. "We're seeing that trends in private physician payments are pretty much reflecting what we're seeing in Medicare." [The reason private health plans are not increasing physician fees is because Medicare is not increasing its fees paid to doctors. Again, those fees have increased none whatsoever since 2007]
Drug spending should rebound
The pace of growth in drug spending has slowed recently because more generic drugs have been prescribed, a number of blockbuster drugs have lost patent protection, fewer new drugs have been approved and larger drug rebates have been negotiated from manufacturers by payers, said Joshua Cohen, PhD, a senior research fellow at the Tufts Center for the Study of Drug Development.
But steady increases in the use of biopharmaceuticals and specialty drugs could help propel drug spending back up at faster rates in future years, Cohen said. Many new biopharmaceuticals are in the works to fight diseases such as cancer or Alzheimer's, and some of these drugs won't have as much competition as new, chemically manufactured drugs have had, he said....
2007 spending
Prescription drugs....$227.5 billion
Physician and clinical services....$478.8 billion
(Physician fees alone are 80% of this amount, making total annual physician fees $382 billion of the total $2.2 trillion.)
Hospitals....$696.5 billion
Nursing homes....$131.3 billion
Home health....$59.0 billion
Public and private administration....$155.7 billion
Note: Public and private program administration includes the costs of running government health care programs and the difference between premiums earned by insurers and their claims or losses.
Source: Centers for Medicare & Medicaid Services Office of the Actuary, January (http://content.healthaffairs.org/cgi/reprint/28/1/246/)....
Source: Government Accountability Office, September 2008 (www.gao.gov/products/gao-08-1102r)"
Weblink
"National Health Spending: Slower Drug Spending Contributes to Lowest Rate of Overall Growth Since 1998," abstract, Health Affairs, January/February (content.healthaffairs.org/cgi/content/abstract/28/1/246)
"Medicare: Trends in Fees, Utilization, and Expenditures for Imaging Services Before and After Implementation of the Deficit Reduction Act of 2005," Government Accountability Office memo, Sept. 26, 2008, in pdf (www.gao.gov/new.items/d081102r.pdf)
--------------------------------------------------------------------------------
Note again that of the $2.2 trillion in annual health care spending, only $382 billion goes to paying physicians' fees. This amounts to only 17.3% of total annual health care spending.
Don't blame doctors for skyrocketing health care costs. Over 80% of the health care dollar goes to someone other than physicians (like health insurance company CEOs and stockholders.)
U.S. health spending tops $2.2 trillion
By Doug Trapp
Jan. 19, 2009.
"National health spending in 2007 grew at its slowest pace since 1998....
Overall health spending increased by only 6.1% in 2007 to reach $2.24 trillion, according to the annual Centers for Medicare & Medicaid Services report, published in the January/February issue of Health Affairs. Health expenditures last dipped below the 6% growth mark in 1998.
Prescription drug spending grew by only 4.9% in 2007....down from an 8.6% growth rate in 2006....
The growth in physician and clinical services spending -- a combined measure of revenues to both doctors and clinics -- held steady between 2006 and 2007....
Growth in national health spending has been slowing since 2002. But spending on physicians alone, which accounts for 80% of this category, saw slightly slower growth in 2007 -- 5.9%....
Spending on most health care services other than prescription drugs grew at the same rate as 2006 or faster....
CMS Chief Actuary Richard S. Foster said that although recent trends have been positive, health spending growth in 2007 was still faster than the rate of inflation and wage growth. In addition, the current rate of generic drug use cannot increase forever....
Overall, growth in national health spending has been slowing since 2002.....
Insurers count their net cost as the difference between premiums they receive and claims they pay....
Medicare fees have an impact
As a subset of total health expenditures, Medicare spending growth on physician and clinical services decelerated to 4.6% in 2007....This drop is due in part to imaging fee cuts in the Deficit Reduction Act of 2005. Growth in spending on doctors also was kept in check by the fact that Congress froze Medicare rates to physicians in 2007.[This is in current dollars, not inflation-adjusted dollars, which means doctors' reimbursements declined in real, inflation adjusted terms, and despite an ~1% increase in the number of patients.]
In approving the 2005 legislation, Congress was attempting to curtail what it saw as overly rapid growth in physician-administered advanced imaging, such as CT and MRI scans. Medicare spending on all physician imaging services doubled between 2000 and 2006, reaching the $14 billion mark in that year, according to a Government Accountability Office report released in September 2008. The deficit reduction law reduced fees in 2007 for administering many physician imaging tests by limiting them to outpatient hospital rates.
Prescription drug spending grew by only 4.9% in 2007,(still more than the cost-of-living) its slowest rate of growth since 1963. The move reduced Medicare per-beneficiary spending on physician imaging between 2006 and 2007 after years of steady increases, according to the GAO report. But the reduced fees did not appear to have the desired effect on imaging utilization, at least not right away. The number of tests performed per beneficiary continued to increase at a rate comparable to prior years. That's because the physicians performing the scans generally aren't the ones ordering them [In other words, they were being ordered by physicians due to increased medical necessity, not due to increased potential financial gain, since the ordering physician made nothing extra by ordering additional testing].....
"Imaging centers and practices away from the hospital aren't buying and updating their equipment like they used to be able to do," he said. They're also taking a hard look at the number of employees they maintain.
Further cuts could lead to facility closures, especially of rural imaging centers, which would force Medicare beneficiaries to travel even farther to receive needed scans, Dr. Allen said.
Given that private insurers typically base many of their rates and coverage decisions on how Medicare sets them, [NO, given that ALL private insurers always base their rates on "how Medicare sets them."] insurers likely followed Medicare's lead and adopted imaging fee cuts of their own, said Benjamin Washington, a CMS statistician....
Also, private health plans are increasing physician fees only slightly, if at all, Washington said. "We're seeing that trends in private physician payments are pretty much reflecting what we're seeing in Medicare." [The reason private health plans are not increasing physician fees is because Medicare is not increasing its fees paid to doctors. Again, those fees have increased none whatsoever since 2007]
Drug spending should rebound
The pace of growth in drug spending has slowed recently because more generic drugs have been prescribed, a number of blockbuster drugs have lost patent protection, fewer new drugs have been approved and larger drug rebates have been negotiated from manufacturers by payers, said Joshua Cohen, PhD, a senior research fellow at the Tufts Center for the Study of Drug Development.
But steady increases in the use of biopharmaceuticals and specialty drugs could help propel drug spending back up at faster rates in future years, Cohen said. Many new biopharmaceuticals are in the works to fight diseases such as cancer or Alzheimer's, and some of these drugs won't have as much competition as new, chemically manufactured drugs have had, he said....
2007 spending
Prescription drugs....$227.5 billion
Physician and clinical services....$478.8 billion
(Physician fees alone are 80% of this amount, making total annual physician fees $382 billion of the total $2.2 trillion.)
Hospitals....$696.5 billion
Nursing homes....$131.3 billion
Home health....$59.0 billion
Public and private administration....$155.7 billion
Note: Public and private program administration includes the costs of running government health care programs and the difference between premiums earned by insurers and their claims or losses.
Source: Centers for Medicare & Medicaid Services Office of the Actuary, January (http://content.healthaffairs.org/cgi/reprint/28/1/246/)....
Source: Government Accountability Office, September 2008 (www.gao.gov/products/gao-08-1102r)"
Weblink
"National Health Spending: Slower Drug Spending Contributes to Lowest Rate of Overall Growth Since 1998," abstract, Health Affairs, January/February (content.healthaffairs.org/cgi/content/abstract/28/1/246)
"Medicare: Trends in Fees, Utilization, and Expenditures for Imaging Services Before and After Implementation of the Deficit Reduction Act of 2005," Government Accountability Office memo, Sept. 26, 2008, in pdf (www.gao.gov/new.items/d081102r.pdf)
--------------------------------------------------------------------------------
Note again that of the $2.2 trillion in annual health care spending, only $382 billion goes to paying physicians' fees. This amounts to only 17.3% of total annual health care spending.
Don't blame doctors for skyrocketing health care costs. Over 80% of the health care dollar goes to someone other than physicians (like health insurance company CEOs and stockholders.)