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Merrill Matthews: Explaining the (Temporary?) Decline in Health Care Spending

POSTED BY Galen Institute on May 2, 2012.

The news is good: The growth in health care spending declined in 2009 and 2010, to just under 4 percent in both years.  The bad news is that President Obama’s health care law, if it survives the U.S. Supreme Court and the “repeal and replace” effort, will essentially negate a primary reason for the decline, taking us right back to unsustainable health care spending — and opening the door for even more top-down micromanaging and health care price controls.

Here’s a fact you can take to the bank: The primary driver behind the unsustainable growth in U.S. health care spending is that patients are insulated from the cost of care.  That is, in the vast majority of cases when a patient goes to the doctor or hospital or pharmacy, some third party — government, employers or health insurers — is paying the bill.

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