ACA put the brakes on spending across the care continuum, White House economists say

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Spending on healthcare, including skilled nursing care, has grown at a historically slow rate in the last three years, according to a new analysis from the Council of Economic Advisers. The group, which reports to the president, linked the slow growth to Affordable Care Act policies.

Spending for home health and skilled nursing care increased at an average annual rate of 1.1% between 2010 and 2013, the report stated. This is compared with a 6.5% rate for the period from 1965 to 2010. The calculations were based on numbers from the Centers for Medicare & Medicaid Services.

Total national health expenditures grew at an average annual rate of 1.3% during the last three years, according to the report. This is the slowest three-year growth rate on record, going back to 1965.

Other reports also have noted the slowdown in healthcare spending, but have attributed it to the recession. The CEA report challenges this idea, saying that the Affordable Care Act has created positive structural changes.

The 0% average annual growth rate in Medicare spending over the last three years is one piece of evidence that the report authors marshal. Medicare spending generally is not significantly affected in a poor economy, they state. The cost control in this area instead has come from ACA policies such as hospital readmission penalties and the formation of alternative payment models, such as accountable care organizations.

“Aggressive implementation” of further ACA reforms and related initiatives, such as those in the White House's 2014 proposed budget, are needed to sustain these positive spending trends, the report states. The budget proposals included penalties for skilled nursing facilities with high rates of hospital readmissions.

Click here to access the complete report, issued Wednesday.