CMS Actuary Releases 2024 Healthcare Spending
Each year, the Centers for Medicare and Medicaid Services (CMS) Office of the Actuary releases annual healthcare expenditures for the prior year. This year the release was delayed due to the government shutdown.
The Actuary found that the U.S. spent $5.28 trillion on healthcare in 2024, a 7.2% increase from the prior year. The robust growth shows the challenges ahead for healthcare. It was the second consecutive year costs trended up more than 7%. Healthcare accounted for 18% of gross domestic product (GDP) in 2024, up slightly from 2023.
Spending on hospital care grew 8.9% to $1.6 trillion. Spending on physician and clinical services increased 8.1% to $1.1 trillion. The Actuary said prices are a factor but non-price factors, such as utilization, were the driver. CMS’ actuaries attributed about 1% of the gain to population growth, 2.5% to price increases, and 3.6% to remaining nonprice factors.
I will have a deep dive into the Actuary’s report next week at my blog site.
The Census Bureau also released healthcare statistics this week based on the 2024 Current Population Survey. The typical working family in the U.S. spent $3,960 on healthcare-related costs in 2024, including premiums and out-of-pocket expenses. One in eight working families spent more than 10% of their income on healthcare. Ten percent of working families paid more than $14,800 in premiums and out-of-pocket costs. The low income and those from rural areas spent the greatest percentage of income on healthcare.
Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-health-spending-2024-cms/ and https://www.healthcaredive.com/news/us-healthcare-spending-2024-cms-health-affairs/809578/ and https://www.medpagetoday.com/publichealthpolicy/medicare/119435 and https://www.beckershospitalreview.com/finance/average-us-family-spent-nearly-4k-on-healthcare-in-2024-report/
(Some articles may require a subscription.)
#healthcare #expenditures #nhed #cms
https://www.fiercehealthcare.com/finance/cms-us-total-healthcare-spending-rose-72-53t-2024
United To Roll Out Rural Hospital Aid
UnitedHealthcare is rolling out a new program that aims to support cash-strapped rural hospitals. United will accelerate the payment timelines in its Medicare Advantage (MA) plans by 50% over the next six months. This will reduce timeframes in four states from an average of less than 30 days to less than 15 days.
Additional article: https://www.fiercehealthcare.com/payers/unitedhealthcare-unveils-pilot-accelerate-payments-rural-hospitals and https://www.modernhealthcare.com/providers/mh-unitedhealthcare-rural-payment-acceleration-pilot/
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#unitedhealthcare #hospitals #ruralhealthcare
Kaiser Settles MA Risk Adjustment Fraud Allegations
Affiliates of Kaiser Permanente agreed to pay more than half a billion dollars to settle allegations that it gamed the Medicare Advantage (MA) risk adjustment system for profit. The $556 million civil fraud settlement is among the largest amounts paid by an insurer to resolve claims of fraud.
The Justice Department alleged Kaiser got higher payments from the government by submitting invalid diagnosis codes and “systematically pressured” doctors to add diagnosis codes in violation of Medicare rules.
The settlement will heighten the drive for reform on Capitol Hill.
In other news, Alignment Healthcare is preparing for a major market expansion in 2027 after announcing a year over year 31% increase in 2026 in its MA plans. Clover Health reported a 53% year-over-year growth in Medicare Advantage PPO membership. The company will reach full year GAAP net income profitability for the first time.
Additional articles: https://www.beckerspayer.com/payer/medicare-advantage/clover-health-sees-53-increase-in-medicare-advantage-members/ and https://www.modernhealthcare.com/insurance/mh-jpm-2026-alignment-healthcare-medicare-advantage/
(Some articles may require a subscription.)
#medicareadvantage #kaiserpermanente #riskadjustment #fwa #overpayments
https://www.modernhealthcare.com/legal/mh-kaiser-permanente-medicare-fraud-doj
NY Drive For Affordability In Healthcare
Democratic Gov. Kathy Hochul proposed several affordability initiatives.
The state’s Department of Health will negotiate with federal officials over Essential Plan coverage losses impacting 450,000. Further, Governor Kathy Hochul noted that 140,000 New Yorkers will have a 38% increase in premiums due to the expiration of enhanced Exchange subsidies.
Prior authorization (PA) reforms include transparency of formularies, extending continuity of care requirements to 90 days, longer PA authorization periods for certain chronic conditions, and claims processing reporting.
#priorauthorization #ny #healthplans #affordability #exchanges #healthcare #coverage
— Marc S. Ryan
