Opinion: Was Health Care on the Mend Before Reform?

As the new Republican House majority gets set to vote on repealing health care reform, critics of the move say that doing so would only put the country back on its unsustainable health care path -- one characterized by runaway costs.

But how accurate is that worry?

The latest figures on national health spending show that, well before reform, the nation's health care system was succeeding in slowing the rate of spending growth on its own.

According to the Centers for Medicare and Medicaid Services, national health spending climbed just 4 percent last year. The low number is attributed to the recession, but it actually continues a trend started much earlier.

Indeed, as the chart below shows, annual spending increases have been steadily moderating for the past eight years.

Annual % Change in National Health Spending

And, the data show, these spending increases would have been lower still had the government kept pace with the private sector. Last year, for example, private insurance spending climbed just 1.3 percent. Medicare spending, in contrast, climbed 7.9 percent. On a per-enrollee basis, private insurance spending has climbed at about half the rate of Medicare since 2005.

Over the longer term, government health care spending has climbed faster that private spending in eight of the past 10 years. (See chart below.)

Public vs. Private Health Care Spending (Annual % Change)

At the same time, premium increases have been steadily moderating over the past several years. According to the Kaiser Family Foundation, premiums for employer-sponsored family coverage climbed just 3 percent in 2010, compared with 13 percent in 2002.

Now, to be clear, none of this is to say that the country's health care system isn't a mess or doesn't need fixing. It clearly does. It leaves too many without coverage, it costs too much, and even at a lower rate of spending growth, health care continues to eat up an ever larger share of the nation's economy.

But something right appears to have been going on in the health care system before last year's reform was passed. And no matter what happens with the GOP's repeal effort, it's still worth trying to figure out what that was, if only to make sure that whatever reforms do stay in place don't undermine it.