Trends: Health spending projections through 2017: The baby-boom generation is coming to medicare

Health Affairs

Volumn 27, Issue 2, 2008, Pages

  Keehan, Sean ^a,b   Sisko, Andrea ^a   Truffer, Christopher ^a,c   Smith, Sheila ^a   Cowan, Cathy ^a   Poisal, John ^a,b   Clemens, M Kent ^a,c   Cylus, Jonathan ^b   Lyons, Kevin ^b  

^a CENTERS FOR MEDICARE AND MEDICAID SERVICES   (United States)

^b NHSG ^*

^c Medicare and Medicaid Cost Estimates Group

Author keywords

[No Author keywords available]

Indexed keywords

ARTICLE; BABY BOOMER; FINANCIAL MANAGEMENT; HEALTH CARE COST; HEALTH CARE FINANCING; HEALTH SERVICE; HUMAN; LONG TERM CARE; MEDICAID; MEDICARE; POPULATION GROWTH; PRIVATE HEALTH INSURANCE; ECONOMICS; FORECASTING; POPULATION DYNAMICS; STATISTICS; UNITED STATES;

ECONOMICS; FORECASTING; HEALTH EXPENDITURES; HUMANS; MEDICARE; POPULATION DYNAMICS; UNITED STATES;

EID: 41749104276     PISSN: 02782715     EISSN: 02782715     Source Type: Journal    
DOI: 10.1377/hlthaff.27.2.w145     Document Type: Article

References (32)

1. J. Poisal et al., "Health Spending Projections Through 2016: Modest Changes Obscure Part D's Impact," Health Affairs 26, no. 2 (2007): w242-w253 (published online 21 February 2007; 10.1377/hlthaff.26.2.w242).
2. A. Catlin et al., "National Health Spending in 2006: A Year of Change for Prescription Drugs," Health Affairs 27, no. 1 (2008): 14-29.
3. Boards of Trustees, 2007 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds, 23 April 2007, http://www.cms.hhs.gov/ReportsTrustFunds/downloads/ tr2007.pdf (accessed 23 January 2008).
4. For a description of the projections model, see CMS, "Projections of National Health Expenditures: Methodology and Model Specification," 21 February 2007, http://www.cms.hhs.gov/NationalHealthExpendData/downloads/ projections-methodology.pdf (accessed 23 January 2008).
5. Boards of Trustees, 2007 Annual Report.
6. Available historical data (as of December 2007) and updated near-term forecasts are used to transition to the 2007 Medicare Trustees report assumptions.
7. OMB, "Budget of the United States Government, Fiscal Year 2009," http://www.whitehouse.gov/omb/budget (accessed 23 January 2008).
8. CMS, "Projection Accuracy of National Health Expenditures," http://www.cms.hhs.gov/NationalHealthExpendData/ 03_NationalHealthAccountsProjected.asp#TopOfPage (accessed 23 January 2008).
9. S. Folland, A. Goodman, and M. Stano, The Economics of Health and Health Care, 5th ed. (Upper Saddle River, N.J.: Pearson Education, 2007), 244.
10. Real physician income measures are largely excluded from our input price measures. See H.T. Tu and P. Ginsburg, "Losing Ground: Physician Income, 1995-2003" (Washington: Center for Studying Health System Change, June 2006).
11. This compares to an output price to input price differential of 1.6 percentage points from 1980 through 1995 and -0.3 percentage point from 1995 through 2006.
12. Growth in real disposable personal income rose from 2.5 percent in 2002 to 3.2 percent in 2007. Growth is expected to slow for the rest of the projection period, ending at 2.3 percent by 2017, which is 0.5 percentage point below its average over the past thirty years.
13. M. Hartman et al., "U.S. Health Spending by Age, Selected Years through 2004," Health Affairs 27, no. 1 (2008): w1-w12 (published online 6 November 2007; 10.1377/hlthaff.27.1.w1).
14. BLS, "B-16. Average Hours and Earnings of Production and Nonsupervisory Workers on Private Nonfarm Payrolls by Detailed Industry," ftp://ftp.bls.gov/pub/suppl/EMPSIT.CESEEB16.TXT (accessed 19 February 2008).
15. Global Insight Inc., "3rd Qtr 2007; @USMACRO/CONTROL0807@CISSIM/ TL0807.SIM" (Contract no. GS-10F-0318K, HSM-500-2006-00037G, prepared for the CMS, 2007).
16. This is a one-year adjustment that is not expected to affect future MA enrollment trends.
17. M.K. Clemens, "Estimated Sustainable Growth Rate and Conversion Factor, for Medicare Payments to Physicians in 2007," November 2006, http://www.cms.hhs.gov/SustainableGRatesConFact/Downloads/sgr2007f.pdf (accessed 23 January 2008).
18. M.K. Clemens, "Projected Medicare Part B Expenditures under Two Illustrative Scenarios with Alternative Physician Payment Updates," April 2007, http://www.cms.hhs.gov/ReportsTrustFunds/downloads/ AlternativePhysicianUpdate.pdf (accessed 23 January 2008).
19. See note in Exhibit 6.
20. V. Smith et al., "As Tough Times Wane, States Act to Improve Medicaid Coverage and Quality: Results from a Fifty-State Medicaid Budget Survey for State Fiscal Years 2007 and 2008," October 2007, http://www.kff.org/ medicaid/7699.cfm(accessed 23 January 2008).
21. See Mercer, "U.S. Employers' Health Benefit Costs Continues to Rise at Twice the Inflation Rate," Press Release, 19 November 2007, http://www.mercer.com/press release/details.jhtml/dynamic/idContent/1287790 (accessed 23 January 2008);
22. and Henry J. Kaiser Family Foundation/Health Research and Educational Trust, Employer Health Benefits: 2007 Annual Survey, September 2007, http://www.kff.org/insurance/7672/index.cfm (accessed 23 January 2008).
23. Ibid.
24. A. Rosenblatt, "The Underwriting Cycle: The Rule of Six," Health Affairs 23, no. 6 (2004): 103-106.
25. P. Fronstin, "The Future of Employment-Based Health Benefits: Have Employers Reached a Tipping Point?" EBRI Issue Brief no. 312 (Washington: EBRI, December 2007).
26. S. Rubenstein, "Why Generic Doesn't Always Mean Cheap," Wall Street Journal, 13 March 2007;
27. and S. Saul, "Helped by Generics, Inflation of Drug Costs Slows," New York Times, 21 September 2007.
28. Medco Health Solutions, 2007 Drug Trend Report (Franklin Lakes, N.J.: Medco, 2007), 38-40.
29. CVS Caremark, Trends Rx Report 2007 (Woonsocket, R.I.: CVS, 2007), 27-30.
30. Smith et al., "As Tough Times Wane."
31. H. Pham and P. Ginsburg, "Unhealthy Trends: The Future of Physician Services," Health Affairs 26, no. 4 (2007): 1586-1598.
32. Hartman et al., "U.S. Health Spending by Age."