Spending growth slows
Healthcare spending growth slowed to its lowest level in three years as insured patients passed up increasingly costly care when faced with higher copayments and deductibles, according to a study by the Center for Studying Health System Change, Washington. Spending for privately insured Americans rose 8.5% in the first half of 2003, down from a 10% increase in the second half of 2002. That's the sharpest six-month drop since the early 1990s and could prompt a slowdown in premium increases next year, the study said. Prescription drug spending growth slowed the most, rising only 8.5% in the first half of the year, down from 13.4% in the second half of 2002. Spending on hospital inpatient care grew 7.6%, down from 8.3%. Spending on outpatient care, still the fastest growing healthcare category, rose 12.9%, down from 14.1%. Spending on physician services was the slowest growing category, rising 6.1% in the first half of 2003. Despite the slowdown, total healthcare spending grew nearly three times faster than the overall economy.
Scully waiver questioned
Reps. Pete Stark (D-Calif.) and Jan Schakowsky (D-Ill.) questioned the propriety of an ethics waiver granted to CMS Administrator Tom Scully that allowed him to speak to potential employers while working on Medicare legislation. Scully, who is leaving the CMS this week, received the waiver in May from HHS' top ethics officer, Edgar Swindell. In a letter to HHS Secretary Tommy Thompson, Stark and Schakowsky expressed outrage that Congress was not informed of the waiver until recently. Scully has said that the firms he spoke with never asked for advice on the Medicare bill and says he did not violate any ethical standards.
Acute-care prices decline
Prices for acute-care hospital services declined 0.1% in November following a 1.6% rise in October, according to the U.S. Department of Labor's Producer Price Index. Hospital prices were 5.3% higher than a year earlier. Prices for physician services grew 0.1%, up 1.9% from a year earlier. The PPI for finished goods declined 0.3% in November, up 3.4% for the 12-month period.
Calif. nurse-staffing law on track
California Gov. Arnold Schwarzenegger will not seek to delay the state's landmark nurse-staffing regulations, set to take effect Jan. 1, 2004. The governor last month suspended all proposed state legislation for 180 days and called for a review of all laws enacted by former Gov. Gray Davis over the past five years (See related editorial, p. 18). Hospital industry officials had used the moratorium as an opportunity to press for delays and revisions to the nurse-staffing law, signed by Davis in 1999. The law is designed to improve patient safety by requiring hospitals to beef up their nurse-to-patient ratios. Hospitals contend the bill's estimated $480 billion annual price tag coupled with a nationwide nurse shortage has made compliance nearly impossible.