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3 Reasons Why Health-Care Costs Are Likely to Rise

By Keith Speights

1. Macroeconomic factors: The Kaiser Family Foundation, and the Altarum Institute’s Center for Sustainable Health Spending, created a statistical model that helps identify how U.S. health spending varies with several macroeconomic indicators. Their research found that two macroeconomic variables account for a whopping 85% of variation in health-care spending growth between 1965 and 2011…

2. Obamacare: While we can’t be sure how long it will take for GDP growth to get back to historical levels, there’s one driver of higher health spending that you can probably mark on your calendar now: implementation of Obamacare in 2014. Actuaries and economists with the federal government expect health-care cost growth to jump to 7.4% next year as a result of health reform implementation…

3. The patent cliff’s cliff: Pharmacy benefits manager Express Scripts (NASDAQ: ESRX) says that spending on prescription drugs decreased in 2012 for the first time in two decades of monitoring. This slight drop stemmed from more low-cost generic drugs on the market. Several popular brand drugs lost patent protection in recent years in a wave often referred to as the “patent cliff”…

Read the Rest @ 3 Reasons Why Health-Care Costs Are Likely to Rise (CYH, ESRX, MDAS, PFE).

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