Healthcare Costs to Hit 20% of U.S. Spending by 2020 « Health Insurance Advisory

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new healthcare reform lawThe new healthcare law, called the Patient Protection and Affordable Care Act (PPACA), represents comprehensive healthcare reform legislation signed into law on March 23, 2010. It contains numerous provisions designed to protect consumers and promote low cost medical insurance, including many new taxes to pay for the cost.

In this section of the site, you can also obtain the following information specific to your state: available medical insurance options, efforts to regulate medical insurance premiums, healthcare, the individual medical insurance marketplace and the new healthcare law.

Our objective is to help Americans make sense of the new healthcare law by explaining key provisions in plain English and assisting individuals, families and the self-employed in using this information to find and secure affordable medical insurance.

Healthcare Costs to Hit 20% of U.S. Spending by 2020

U.S. healthcare costs will account for 19.8 percent of the nation’s spending by 2020, up from 17.6 percent in 2009, with the government paying a bigger portion of the bill, researchers say.

The report, published by the journal Health Affairs, looked at projected U.S. health spending through 2020 and estimated the government’s share of health spending will increase from 45 percent today to 49 percent by 2020.

The increase is partly due to a percentage of the 30 million people gaining health insurance through the new healthcare law, called the Patient Protection and Affordable Care Act signed into law by President Barack Obama.

According to the report, the average annual growth in national health spending is expected to be 5.8 percent, or 0.1 percentage point higher than it would be without the Affordable Care Act, outpacing annual GDP growth.

For 2010, the researchers estimated health spending grew at a historically low rate of 3.9 percent to $2.6 trillion. They attributed this to a weak economy that has led many consumers to delay medical treatment. Future spending will likely grow at a faster pace fueling concerns over how to cut the country’s deficit, now the subject of fierce debate among lawmakers ahead of a deadline for raising the government’s borrowing limit.

The largest increase in healthcare spending in a single year is expected in 2014, when CMS forecasts a rise of 8.3 percent as much of the new healthcare law is implemented. The law’s provisions include introducing state-based insurance exchanges and increased access to the government’s Medicaid insurance plan for the poor.

The report estimated spending growth will average 6.2 percent annually from 2015 through 2020.

According to the report, some large employers with low-wage employees are expected to stop offering health insurance in 2014. An estimated 13 million employees will then likely seek insurance in the new exchanges or by enrolling in Medicaid, according to Rick Foster, CMS’s chief actuary.

Increased access to health insurance is another explanation for the high growth rate, because with access comes demand.

The researchers estimated that doctor visits, clinical services and prescription drugs will be some of the largest growth areas, because of the comparably young age of the newly insured population. The report said younger patients tend to require less acute care.

For low cost medical insurance visit healthinsuranceadvisory.org. You will find a wide assortment of health insurance, such as high deductible health plans and Health Saving Accounts. Our online medical insurance quotes make it easy to shop and compare individual medical insurance plans and self employed medical insurance from top health insurance companies in your state. If you need assistance with learning your medical insurance options, such as COBRA Continuation and HIPAA Portability, we can help you too!

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