CMS press release: Number of Uninsured Projected to Decrease, Faster Health Expenditure Growth Expected as Coverage Expands and the Economy Improves, CMS Actuary Reports

Read this press release and it pretty much makes sense. We know the number of Americans with health insurance is expanding, we know that more insurance means more spending, we know an improved economy means more spending and we even know that with more people having insurance and more coverage mandates some people will have lower out-of-pocket costs.

What doesn’t make sense is the political spin from the CMS administrator that I highlighted. Even if you acknowledge that the ACA cut Medicare payments and this reduced short-term spending levels, that has nothing to do with slower growth rates. In fact, to some extent you could argue that lower payments stimulate higher utilization. And managing utilization is not something Medicare does well.

So, exactly how has the Affordable Care Act slowed the rate of increase in health care costs? Really‼️ Let’s think about this.


FOR IMMEDIATE RELEASE Contact: CMS Media Relations
September 3, 2014 (202) 690-6145 or

Number of Uninsured Projected to Decrease, Faster Health Expenditure Growth Expected as Coverage Expands and the Economy Improves, CMS Actuary Reports

The number of uninsured is expected to decline by nearly half from 45 million in 2012 to 23 million by 2023 as a result of the coverage expansions associated with the Affordable Care Act, according to a report from the Centers for Medicare & Medicaid Services (CMS) Office of the Actuary. The report is being published today in Health Affairs.

“Health care costs are increasing at a slower rate thanks to the Affordable Care Act,” said Marilyn Tavenner, CMS administrator. “The dramatic decrease in the number of uninsured Americans is a win for our country and its economy in the future.”

Health spending growth for 2013 is projected to remain slow at 3.6 percent, which would mark the fifth consecutive year of spending growth under 4.0 percent. National health expenditures (NHE) are projected to grow at an average rate of 5.7 percent for 2013 through 2023, about 1.1 percentage points faster than the expected average annual growth rate for the Gross Domestic Product (GDP).

Average annual growth of 6.0 percent per year is projected for 2015 through 2023, largely as a result of the continued implementation of the Affordable Care Act coverage expansions, faster projected economic growth, and the aging of the population. While projected growth over the projection period is faster compared to recent experience, it is still slower than the growth observed over the last two decades. From 1990-2008, the average rate was 7.2 percent and health spending grew 2 percentage points faster than GDP.

The National Health Expenditure projections report, issued annually, contains estimates of spending for health care in the U.S. over the next decade by type of service and source of funding.

Other Findings:

2014 Spending Growth Expected to Accelerate. For 2014, the health spending growth rate is expected to be 5.6 percent, as 9 million Americans are projected to gain health insurance coverage, predominantly through Medicaid or the Health Insurance Marketplaces. Out-of-pocket spending is projected to decline by 0.2 percent.

Government Health Expenditures Expected to Increase. By 2023, health expenditures financed by Federal, State, and local governments are projected to account for 48 percent of national health spending. In 2012, such expenditures constituted 44 percent of national health spending.
To read “National Health Expenditure Projections, 2013-23” in Health Affairs, go to:

For more information, including historical data on national health expenditures, visit:

CMS Media Relations Group has sent this update. To contact go to our contact us page.

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