Health care spending sees biggest jump since 1980
The increase, attributed the Affordable Care Act and Medicaid expansion, had a big impact on the nation's first-quarter GDP.
This post comes from Brett LoGiurato at partner site Business Insider.
Spending on health care grew an astounding 9.9 percent in the Bureau of Economic Analysis' advance estimate of first-quarter GDP.
It's the biggest percent change in health-care spending since 1980, when health-care spending jumped 10 percent in the third quarter. Analysts said it's primarily due to a consumption boost from the implementation of the Affordable Care Act. Adjusted for inflation, America is spending more on health care than ever before.
Personal consumption grew by 3.0 percent, about half of which was due to the growth in health-care spending, said Ian Shepherdson, chief economist for Pantheon Macroeconomics.
"If health-care spending had been unchanged, the headline GDP growth number would have been -1.0 percent," Shepherdson said.
A BEA representative said the uptick "reflects additional spending associated with the implementation of the Affordable Care Act."
The first-quarter advance estimate reflects spending from January through March, the first three months when millions of people who gained insurance by signing up on exchanges established by the law or by qualifying for Medicaid coverage under the program's expansion.
Jared Bernstein, the former chief economist to U.S. Vice President Joe Biden and now a senior fellow at the Center on Budget and Policy Priorities, speculated that the growth was more likely associated with the Medicaid expansion at this point.
Sign-ups through the exchanges exploded in March, the last month of the first open enrollment period. Of the more than 8 million people who eventually enrolled in insurance plans, nearly half signed up in March or in a special two-week extended period in April. This means the uptick in health-care spending could be even bigger next quarter.
The detailed consumption data in the advance GDP report displays that spending on doctors and hospital services began to rise rapidly last fall, when the law known as Obamacare was implemented.
"Both are now running at more than twice their pre-Obamacare trend, indicating that pent-up/hidden demand for healthcare was huge," Shepherdson said.
"Next question: How long will it last?"
Here's a chart from Pantheon that shows the growth over the past year in spending on doctor and hospital services, the two factors that dominate the health-care portion of GDP:
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I'll respect you in the morning.
The check is in the mail.
I'm from the government, I'm here to help.
If you like your health insurance you can keep your health insurance.
If you like your constitution, you can keep your constitution, period.
Every lawmaker that voted for this disaster has to go.
What a joke America is now!
Who really cares about health care cost in the aggregate? It should be a personal responsibility and you should worry about what it costs you the individual. Did your healthcare costs go up? Why? Was it because of a change in government policy?
Most of the government policies regarding healthcare insurance and a majority of other things not mandated in the Constitution are just social engineering programs primarily concerned with redistribution of wealth.
We need to return to a "fee for service" model and get third parties, and especially the centralized federal government, out of the health insurance business.
I always said you cannot use a socialized healthcare system using the Free Market to set prices. They contradict each other. It's like mixing gas with fire.
So, we already spent more than twice as Europe, per person, and Obamacare increased that by 10%.
Can we just get politicians out of everything. They suck at everything they do.
Everything the government does to make life "better and more fair" for one person makes it worse for other people.
It doesn't matter if they're republicans, or democrats. They're all incompetent morons. A law degree in no way prepares you to deal with the complex social issues of a nation.
Premiums for SOME may be less but higher deductibles and co-pays, restrictive doctor and hospital networks, requiring everyone to pay for lactate services, prenatal care, etc. is RAISING COSTS NOW and IN THE FUTURE. PERIOD.
I am trying to figure out how to spend my $2,500 in premium savings this year. Oh, my wife said it is being spent on groceries.
HEALTHCARE.GOV website - We still do not have a secure website. If your personal information is stolen, the government has ZERO liability. In fact they don't even have to tell you your information has been compromised.
Where is that GILLIGAN ISLAND?
OK - everyone go back to texting and smoking your marijuana.
I am glad to see that some people who really need healthcare insurance might (and, I say, "might") actually be getting healthcare; however, the whole "healthcare" issue as it stands, is creating its own firestorm. As a result, what may be good about it is lost somewhere in the morass of bumbling and bickering over it. Unfortunately, I fear it will get much worse before it gets better!!!
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