Largest Drop In Health Care Spending in 50 Years

Spending on health care slowed in 2008, according to a government report released Tuesday. In fact, health spending grew more slowly than at any time in at least a half-century.

However, the annual health spending statistics published by the Department of Health and Human Services are a classic case of good news and bad news.

The good news: Health spending slowed down. Way down, said Anne Martin, one of the authors of the study published in the current issue of the policy journal Health Affairs.

"National health spending growth slowed in 2008 to 4.4 percent, the slowest rate of growth in the National Health Expenditure Accounts."

In other words, the slowest growth since the government has kept records.

The bad news: Health care still totaled $2.3 trillion in 2008. That's more than $7,600 per man, woman and child. Plus it still grew faster than the rest of the economy.

There's still more bad news, says Rick Foster, the chief actuary at HHS. A major reason health spending slowed is that with the bad economy, many people simply couldn't afford medical care.

"In many cases they lost their employee-sponsored health benefits at the same time they lost their jobs. So that meant that the cost of care was much much higher because they had to pay it out of pocket. So some people presumably scaled back on their purchases."

Analysts say that given the depth of the recession, the problems with health spending probably didn't get any better in 2009.