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Dental spending growth slower

January 05, 2015

By Craig Palmer

Washington — Government actuaries cited slower growth in dental spending than projected just three months earlier in a study revising the post-recession National Health Expenditures narrative from "low rates of growth" to "slowdown."

The 3.6 percent increase in the 2013 rate of growth in the overall health economy is the lowest on record since NHE record keeping began in 1960, the Centers for Medicare & Medicaid Services Office of the Actuary said.

CMS actuaries in a September 2014 report had projected that 2013 dental spending would total $113 billion at a 1.9 percent annual growth rate.

The study published Dec. 2, 2014, by the journal Health Affairs as a Web First article said actual dental spending increased by just 0.9 percent to $111 billion.

Dental spending and the annual growth rate had been inching upward since 2009 when it increased minimally from $102.4 billion to $102.5 billion or 0.1 percent over 2008. The 2013 growth rate is the lowest since then.

"We are now seeing a slowdown," CMS statistician Micah Hartman told the media at a pre-release news conference at the National Press Club.

"The recovery growth we're seeing in the economy is much lower than previous recessions."

The recession began in December 2007 and officially ended in June 2009.

Continued low growth in health spending is consistent with the modest overall economic growth since the end of the recession and with the long-standing relationship between economic growth and health spending, particularly several years after the end of economic recessions, when health spending and overall economic growth tend to converge, the NHE team of economists and statisticians said.

As a result, health spending's share of the Gross Domestic Product remained at 17.4 percent in 2013.

This contrasts with 1990-93, 2001-03 and 2008-11, three periods that contained recessions and the years immediately following, when health care spending increased at a much faster average annual rate than GDP.

"The key question is whether health spending growth will accelerate once economic conditions improve significantly; historical evidence suggests that it will," the NHE accounts team said.