We’ve all heard a lot about the slowing of health care cost inflation. Yet, coming from Dan Diamond of The Advisory Board, here are some very interesting points of relevance to the topic:
“A lot of people have noted that health care spending has slowed,” Amitabh Chandra, an economist and the director of health policy research at the Harvard Kennedy School, told me last week.
“Many of us would like to think that this is a more permanent slowdown,” he added.
“[But] we see absolutely no slowdown in employment growth in health care. And if that is not slowing, then it’s very difficult to believe that there will be a sustained slowdown in health care spending.”
Health care gained more than 320,000 jobs in 2012—the sector’s strongest year in five years.
…”One hypothesis is that only lower-paying jobs in health are growing,” the Altarum Institute’s Ani Turner told me via email. But “we don’t think that’s true.” Altarum researchers have reviewed BLS data and found “stable growth” for the most highly paid health care workers—i.e., doctors and nurses—if somewhat lower growth for health care support roles.
And the University of Texas’s Richardson took a look at two other potential culprits: whether the wages paid to health care workers had fallen in recent years, or if their hours worked had declined. But neither scenario had come to pass; in fact, Richardson found that hourly wages had only climbed, while weekly hours worked have remained essentially flat.
The full article is here, and the entire discussion is of interest. You will note for instance that capital spending does seem to be down.
File under “The Puzzle Deepens.”