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FROM THE EDITOR

New Business Models Needed as Health Care Costs Projected to Rise

Controlling health care costs was the original impetus behind the reforms that eventually took shape as the Affordable Care Act. For the last six years, it looked as if that goal was working: from 2008 through 2013, health care spending recorded an average annual rise of four percent. Now, a new government report projects that spending will increase at six percent a year, starting in 2019 and continuing through 2024, and that health care’s share of the economy will grow from 17.4 percent in 2013 to 19.6 percent in 2024. Why? Expanded coverage has enrolled sicker people who use more services and take more medication. Also, a large, aging baby boomer population will require more services and new drugs are expensive. Needed: innovative business models to manage costs.

John Howell, Editorial Director

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