this is the question asked Bunting et al. (2022). The authors used data from the Medicare Master Beneficiary Summary File from 2007-2018 and then performed regression adjustments to control for patient demographics (ie, age, sex), number of chronic conditions (none, 1-3, ≥4), and whether the individual had Part A or Part A and Part B coverage.
Using this approach, the authors found that:
Between 2008 and 2011 and between 2012 and 2015, adjusted annual Medicare Part A and Part B beneficiary spending growth fell from 3.3 percent to -0.1 percent. From 2016 to 2018, the average annual Medicare spending growth rate increased relative to the previous period, but remained below the 1.7 percent annual rate in the baseline period. The slowdown affects all divisions in Parts A and B, except for physician-administered drugs provided in Part B. Changes in payment rates (including sequestration measures) and changes in beneficiary characteristics explained 44% of the variance in overall spending growth per beneficiary in 2007, 2011 and 2012 to 2015, and 2007 to 2011 and 2016 to 63% in 2018.
The authors found that most payment rates were very close to the rate of inflation (21.0% over this period), but physician reimbursements increased by only 6.5%.
The authors note that their findings are consistent with those of the Congressional Budget Office, that overall additional cost growthBetween 2005 and 2017, per capita spending on health insurance exceeded per capita GDP growth by -0.1%. In other words, Medicare spending underperformed economic growth by 0.1 percentage points during this period.
