Health Care Trends

Many who opposed the new Affordable Care Act of 2010 (ACA) predicted that public participation would shrink. Major insurance companies "bid" for a contract to administer the new "Advantage" programs, which offer different recipes of healthcare services, and are partially compensated by the government for taking over portions of what would normally be "pure" Medicare. These companies then "market" their particular program to the public. Apparently the public likes what they are hearing, because they are joining by the millions.

The program was designed to carefully make the system more efficient and eventually lower health care costs in America. Despite predictions that enrollment would drop, enrollment in Medicare Advantage plans has actually climbed from 11.1 million in 2010 to 14.4 million in 2013, a 30% increase. Industry experts expect enrollment to in Advantage plans to continue to grow in 2014. Indeed long term projections predict growth through 2022. Plans appear to be doing more to reduce their costs, and there is indeed a slowdown in medical spending.

US medicine spending dropped in 2012 for the first time in decades. Some believe this is because the new healthcare plan encourages the use of generic drugs. Total spending on medications dropped to $325.8 billion in 2012 from $329.2 billion in 2011. "That's the first time we have seen a decline in drug spending in 58 years" said Michael Kleinrock, director of research development at the IMS.