Every year, give or take, the actuaries at the Centers for Medicare & Medicaid Services (CMS) come out with their projections of what total health spending across the entire economy is going to be over the next several years. CMS is also the entity that officially keeps track of total national health spending so these projections are taken pretty seriously. They released their most up-to-date projections a few days ago.
Back during the '08 presidential campaign, Obama used to (often in somewhat inartful language) promise that under his health plan the average family would save $2,500 per year. Despite some folks claiming this means he promised everyone's premiums would drop by $2,500, the correct way to understand this is as a pledge that out-of-control cost growth in health care would be brought into check, slowing to the point that spending is $2,500 lower than it otherwise would have been. It may still be higher next year than last, but spending will be lower than it was going to be and you'll have money in your pocket that you didn't expect to.
Now we're conflating total health spending across the entire economy and health insurance premiums (which are affected by other distributional factors) a bit here but when we talk about bending the health care cost curve we're talking about slowing the growth of total spending, with the thought that eventually premium growth will follow the trend.
We can compare the CMS actuaries' health spending projections released this month with those they released in 2008, back when on Obama was on the campaign trail:
The changes in their projections reflect the slowdown in health care spending growth that's taken root over the past few years. The total savings thanks to the slowdown from 2009-13 (i.e. the difference between the blue and red lines) alone are over a trillion dollars.
But we can zoom in on this year. It was thought that total health spending would be $3.3 trillion this year, had the cost trends of the 2008 era persisted. But they didn't. Instead, spending this year is closer to $2.9 trillion. The savings from that slowdown is about $390 billion--about $1,245 per person.
Given that the average household has 2.58 people, that means Obama's "$2,500 in savings" pledge would translate to $969 in savings per person in the average family. In other words, thanks to the health care spending slowdown, the savings that Candidate Obama sought have been achieved and then some.
The portion of the slowdown that can be attributed to health reform is currently up for debate but the (favorable) change in the spending picture since 2008 is undeniable.
