On Wednesday, the new head of the White House Council of Economic Advisers released a bombshell report finding that U.S. health care spending since 2010 has increased by just 1.3 percent — the smallest cost growth over a three-year period in American history — while prices in the health care sector rose by 50-year lows, thanks in part to structural changes made by the Affordable Care Act. But most media outlets ignored that story, instead choosing to focus on ongoing glitches with the Healthcare.gov website.
According to a ThinkProgress analysis, English-language online and print media published about ten times as many pieces on the troubles with the Obamacare site than they did on the new health care spending report:
Analysts are divided on the extent to which Obamacare has influenced the remarkable slowdown in health spending since the law was passed in 2010. Most agree that it is likely due to a combination of factors, including less health care consumption in the global financial crisis’ wake, savings from the ACA’s hospital payment reforms, increasing reliance on cheaper generic drugs, and ongoing changes in the medical industry as providers form more efficient and collaborative care models encouraged by Obamacare. It will take years before enough data is available to perform a more precise analysis of Obamacare’s effect on health spending.
Regardless, the record slowdown is one of the most important economic developments of the decade, and has huge ramifications for the fiscal viability of major programs like Medicare and Medicaid. In fact, the Congressional Budget Office (CBO) has already cut its projections for Medicare and Medicaid’s price tag in 2020 by $147 billion — a 10 percent reduction from previous estimates.
That’s significant because those health entitlements are the primary driver of U.S. debt. The CBO’s dire predictions about future debt are based on the assumption that health care costs will continue spiking for the foreseeable future. But now that costs are growing more modestly, the country’s long-term budgetary outlook is improving.
Meanwhile, while Healthcare.gov’s rollout has indeed been disastrous, the site is slowly improving.