This year's national health spending projection is for growth of 6.8 percent in 2006 (yes, it's a projection of something that has already occurred, a system that could work beautifully at the race track) and for average annual growth of 6.9 percent from 2006 through 2016. Spending on private health benefits will reflect this trend, from a peak of 9.5 percent in 2001 to a low of 4.7 percent in 2006. Net costs are expected to add one-tenth of one percentage point to this growth rate. A milder cycle is forecast for next time around, with growth rising to 7.1 percent by 2009 and then dropping to 6.1 percent by 2016, according to John Poisal, deputy director of the National Health Statistics Group and lead author of the study, which appeared in Health Affairs.

Private health insurance premiums will be affected by three factors: growth in medical spending per enrollee for all private payers; changes in the share of spending paid out of pocket by consumers; and variation in the net costs of private health insurance. Profit fluctuates during the cycle.

Excluding the effects of Medicare Part D, premiums per public and private enrollee are projected to have risen just 6.0 percent in 2006, down from 6.5 percent in 2005. Health insurance premiums are expected to follow a milder cycle over the coming decade than in previous decades.

After the storm, smooth sailing

The inception of Part D coverage in 2006 dramatically reshuffled the proportional shares of medical spending. Federal spending that year rose at a 12.7%, driven by a 22.7% Medicare increase, while consumer payments rose only at 3.6%. Medicaid spending moderated, as the dual eligible population moved into Part D. Barring major structural change to health care financing, the National Health Statistics Group expects the long term trend to be steady.

Actual and projected average annual percent growth in U.S. health expenditures, by type

Source: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.