Health spending grew twice as fast as GDP


HHS and insurers disagree over a new batch of Obamacare data, and Donald Trump adds the “death panel” myth-maker to his campaign. But first: Bad news for efforts to bend the cost curve.

FIRST IN PULSE: Health spending grew more than twice as fast as GDP — That’s according to new data from the Altarum Institute, which found that national health spending grew 5.2 percent in the 12 months through June while GDP grew just 2.3 percent.

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Altarum experts note that the weak GDP figures are preliminary and could be revised up. But their data show an unmistakable trend — since the start of 2016, health spending has consistently grown faster than 5 percent, outpacing other sectors.

What that means: health care is steadily consuming more and more of the economy.

“Even if the revisions show more real growth and less price inflation, if the nominal figure is unchanged, we are poised for a continuing increase in the share of GDP going to health care,” Altarum’s Paul Hughes-Cromwick told PULSE.

… Meanwhile, Altarum also flagged an uptick in other key indicators. Health care prices grew at 1.6 percent in June 2016, the highest rate since December 2014. Meanwhile, health care hiring remained strong, with the industry adding about 480,000 jobs in the past 12 months.

See Altarum’s data:


Trump names Betsy McCaughey to his economic team. PULSE readers will know the name: She’s a historian who first gained attention for her scathingly effective assault — which was later discredited — on the Clinton health plan in the early 1990s. McCaughey reinserted herself into health policy during the ACA debate and invented the “death panels” myth — which was named as the 2009 Lie of the Year by PolitiFact.

… Earlier this year, McCaughey argued that Trump’s economic plans were “real, detailed, and great.” As evidence, she cited his health care ideas.

“The Trump campaign is putting forward proposals to fix problems from the long waits for medical care at Veterans Affairs facilities to the impending collapse of ObamaCare,” she wrote in the New York Post.


Insurers skeptical about exchange risk pool improvement. The Obamacare risk pools are improving and stabilizing exactly as anticipated, HHS officials said Thursday, but insurers questioned the numbers underpinning that claim.

HHS’s evidence: Medical costs fell 0.1 percent for exchange customers between 2014 and 2015. That was well below the medical cost growth of 3 percent in the broader insurance market.

… But insurers immediately expressed skepticism, and said that the underlying data to support flat medical costs wasn’t included in the report.

“The reality is that the risk pool has not significantly improved,” said AHIP’s Marilyn Tavenner. “That is a serious concern.”

More from Paul Demko for Pros:
See HHS’s report:

THANK GOODNESS IT’S FRIDAY PULSE Where Arianna Huffington’s year-long speaking tour has convinced us: PULSE needs more sleep to be successful. But we’re still doubtful that Huffington’s new wellness company is going to thrive. See a write-up of her business plan and investor desk at Business Insider, and send tips and melatonin tablets to [email protected] or @ddiamond on Twitter.

With help from Caitlin Emma (@caitlinzemma) and Jen Haberkorn (@JenHab).

** A message from Anthem: The status quo in health care is unacceptable and unsustainable. That’s why Anthem is challenging the DOJ’s flawed decision to block our acquisition of Cigna, a combination that will transform health care by expanding access to affordable, high quality health coverage for consumers. For important information, please visit **


CMS proposes updates to PACE elderly care program. CMS issued a proposed rule on Thursday that aims to make its Programs of All-inclusive Care for the Elderly more attractive to states.

The updates to the program, which helps aging and frail Medicare and Medicaid patients receive medical care and social services in their homes, will incorporate the latest advances in caring for the elderly and changes in technology, CMS Acting Administrator Andy Slavitt said in a blog post, released in conjunction with the proposed rule.

Read Slavitt’s blog post:

… Earlier this year, Slavitt told POLITICO’s “Pulse Check” podcast that PACE was his “favorite program.” He reaffirmed his support for the initiative on Thursday.

“People pay attention to a lot of the things we do at CMS, and some matter more than others,” Slavitt said. “A PACE site was one of the first I visited when I stepped into this job,” he added. “It turned out to be appropriate” because it’s a hallmark of how patient-centered care can work, especially for “the people who need it the most.”


DeSalvo moves on from ONC, stays at HHS. Pro’s David Pittman had the exclusive interview with the departing health IT chief, whose last day is Friday. But DeSalvo will stay in her role as acting assistant secretary of health, focused on public health issues. Vindell Washington, DeSalvo’s deputy, will take over at ONC on Monday. More for Pros.

What’s next for DeSalvo? Her good relations in Washington made it feasible that she could remain at HHS in a Clinton administration, a possibility she didn’t rule out Thursday. “I don’t know what will come for me next, but I hope one day I get the chance to be in public service again,” she told David.

Long-time coming? Back in June, DeSalvo sat for an interview with the “Pulse Check” podcast, where she was quizzed on what the nation was losing by having her split her time between ONC and HHS.

“I’m making personal choices and trade-offs,” DeSalvo acknowledged. “I don’t mean to be Pollyanna when I say that … it is a little bit like medical school or residency, I’ll only do this once.” Listen to the podcast, starting at the 18:40 mark:


HHS shifts $81M in funds, congressional Republicans take credit. After HHS Secretary Sylvia Mathews Burwell said the administration is moving an additional $34 million within NIH and $47 million within BARDA to fight the Zika virus and keep vaccine work going, Republicans took a bow.

Sen. Marco Rubio’s office headlined a statement: “After Rubio’s multiple requests, Obama administration finally agrees to reprogram funds to fight Zika.”

“These much-needed funds have been blocked at every turn by Democrats in the Senate, with the backing of the Obama White House,” House Appropriations Chairman Hal Rogers said in a statement. Of course, neither party put forward a plan that was palatable to the other before recess — and this funding fix is short-term.

The POLITICO story:

Total Zika cases: 8,580. That’s the number across the United States and territories, according to a CDC update Thursday. In the four weeks since Congress left town, the number has more than doubled; the CDC reported 4,222 cases as of July 14.


Troubling health data about LGBT students. Lesbian, gay and bisexual students and students who aren’t sure of their sexual identity are more likely to experience physical and sexual dating violence, new CDC survey data shows.

It’s the first nationally representative data on the health behaviors of lesbian, gay and bisexual students, POLITICO’s Caitlin Emma reports. These students are far more likely to feel “sad or hopeless” than their heterosexual peers — about 24 percent of heterosexual students feel that way, compared to more than 60 percent of lesbian, gay and bisexual students and nearly 47 percent of students who aren’t sure of their sexual identity. Lesbian, gay and bisexual students are also more likely to miss school because they feel unsafe there or on their way to or from school. The data:

“This data is essential to understanding the lived experiences of youth across the nation and to hold our systems and policies accountable for not supporting and protecting the health of young people of all sexual orientations,” said Chitra Panjabi, president of the Sexuality Information and Education Council of the U.S.


Two children diagnosed with polio in Nigeria. It’s the first time in two years — to the day — that wild polio’s been detected on the African continent, and it’s a blow to public health efforts.

“This is not the first time that polio eradication efforts have experienced a setback,” the CDC said in a statement. “It is a reminder that we must redouble efforts to strengthen surveillance and immunization activities.”


Blaming losses from Obamacare, Blue Shield of California will shut down its offices for four days in September to save millions of dollars in payroll-related spending, Chris Rauber reports:

The number of babies born with opioid withdrawal symptoms quadrupled between 1999 and 2013, UPI/HealthDay reports:

At Health Affairs, Chris Duke and Christine Stanik share research on how to overcome low-income patients’ fears about their doctors:

Adam Cancryn looks at the DOJ’s unique argument that an Aetna-Humana merger would create a Medicare Advantage monopoly:

Speaking of insurance mega-mergers, Jay Hancock looks at whether giant insurance companies could use Wal-Mart-like market power to exact lower prices. More at Kaiser Health News:

Harvard’s Michael Anne Kyle and Lauren Taylor plead with nonprofit hospitals — put aside your rivalries and focus on collectively helping your poorest patients. They lay out a strategy at WBUR:

** A message from Anthem: Access, affordability and quality are goals universally shared by all health care stakeholders, but not universally enjoyed by consumers. That’s why the Anthem-Cigna combination matters. Anthem’s acquisition of Cigna will advance affordability, returning an additional $2 billion in health care savings to self-insured customers each year. The combination will also allow Anthem to expand our participation in the health insurance exchanges to nine additional states, even as other companies leave this volatile market. And Anthem will advance quality by further partnering with physicians and hospitals to improve patient outcomes and satisfaction. The flawed DOJ decision is based on a fundamental misunderstanding of the dynamic, competitive, highly regulated health care landscape and preserves a suboptimal market for health care coverage when Americans need and deserve better. Anthem is fully committed to expanding access to affordable, high-quality care and defending the benefits of this acquisition on behalf of consumers. For important information, please visit **

[Source: Politico]

Written by Saheli