News in brief - Jan. 24, 2000

CHIP enrollment doubles; Clinton pushes for more

Washington -- Two million children are enrolled in the Children's Health Insurance Program, a doubling in less than one year, according to the Dept. of Health and Human Services. But that leaves an estimated 11 million children who lack coverage, according to the Kaiser Family Foundation.

To help boost enrollment, President Clinton unveiled a five-year $2.7 billion initiative this month that would provide new options for states to find and enroll children through schools.

Washington -- For the first time in a decade, government spending on health care grew more slowly than private-sector spending. A new federal report shows that in 1998, the nation spent $1.1 trillion on health care services, up 5.6% from the previous year and the fifth consecutive year in which spending growth remained below 6%.

Private spending for health services grew nearly 7% in 1998, a jump from 1997's 4.8% increase. By contrast, public spending grew only 4.1% in 1998, said the Health Care Financing Administration report.

Katharine Levit, director of HCFA's National Health Statistics Group, attributed the slowdown to Medicare's efforts to fight fraud and abuse and to the implementation of payment reforms under the 1997 Balanced Budget Act. Medicare spending grew just 2.5% in 1998 -- the slowest growth rate on record for the program. Although budget act changes could hold down Medicare and other public health spending through 2002, additional changes included in budget act legislation passed late last year could reverse that trend.

The report found that spending on doctor services was $229 billion in 1998, up 5.4% from 1997. The share of doctor spending covered by private health insurance grew from 37.9% in 1980 to 50.5% in 1998.

Managed care, coupled with the the Medicare physician payment system, has held down growth in spending for physician services, said the report. Between 1992 and 1998, growth has averaged about 4.5% a year, compared with 11.6% average annual growth rates between 1960 and 1992.

The report said prescription drug spending grew faster than any other personal health care spending. In 1998, spending for prescription drugs grew 15.4%, up from 8.7% in 1993. Thus, prescription drugs accounted for 8% of the national health bill in 1998, compared with 5.5% in 1993. The report was published in the January-February issue of Health Affairs.