Health Affairs

Health Affairs, 28, no. 5 (2009): 1276-1284 doi: 10.1377/hlthaff.28.5.1276 © 2009 by Project HOPE	New Online   Getting Health Reform Done   After the State of the Union   Incremental Reform   E-Health in Developing World   Most-Read Articles in 2009

This Article Figures Only Full Text (HTML) Reprint (PDF) Technical Appendix Submit a response to this article Comments: View responses Alert me when this article is cited Alert me when Comments are posted Alert me if a correction is posted Services E-mail this article to a friend Similar articles in this journal Similar articles in PubMed Alert me to new issues of the journal Add to My Personal Archive Download to Citation Manager Reprints & Permissions Google Scholar Articles by Smith, S. Articles by Freeland, M. S. PubMed PubMed Citation Articles by Smith, S. Articles by Freeland, M. S. Related Collections Health Reform Insurance Coverage Research And Technology Health Spending Related Blog Posts

Overview

Income, Insurance, And Technology: Why Does Health Spending Outpace Economic Growth?

Sheila Smith, Joseph P. Newhouse and Mark S. Freeland

A broad consensus holds that increased medical capability—technology—is the primary driver of health spending growth. However, technology does not expand independently of historical context; it is fueled by rising incomes and more generous insurance coverage. We estimate that medical technology explains 27–48 percent of health spending growth since 1960—a smaller percentage than earlier estimates. Income (gross domestic product, or GDP) growth plays a critical role, primarily through the actions of governments and employers on behalf of pools of consumers. The contribution of insurance is likely to differ, with less of a push from increasing generosity of coverage and more of a push from changes in provider payment.

                      What's this?

Related Blog Posts: