this sums up the long term benefits of lower increases in health care costs:
If the slowdown in spending growth were to be sustained, it would transform the policy debate about spending and budget deficits. For decades now, the big worry in Washington has been that rising health-care costs will gradually swallow up household and government budgets, squeezing out other forms of spending, and sending the budget deficit soaring. The numbers seemed to show that this was inevitable. Between 1965 and 2010, per-capita outlays on health care increased at an annual rate of 4.5 per cent. At that rate of growth, over-all spending doubles every sixteen years, and the ramifications for purchasers of health care—individuals, firms, and the government—are huge. We’ve all seen the Congressional Budget Office projections that show Medicare and Medicaid accounting for an ever-increasing proportion of the federal budget.
If the rate of growth of health-care spending were to remain at 1.5 per cent a year, or thereabouts, rather than 4.5 per cent, the long-term trends would look very different. Instead of doubling every sixteen years, healthcare spending would take almost fifty years to double. And as long as the economy and tax revenues expanded at a reasonable rate—say 2.25 per cent or more per annum, after adjusting for inflation—the proportion of G.D.P. and the federal budget devoted to health-care spending would level off rather than continuing to climb. Even a more modest but permanent fall in the rate at which spending rises—to two or three per cent a year—would have a big financial and political impact over the long term. As long as health-care outlays rise more or less in line with G.D.P., they can be financed pretty readily, and the threat of a fiscal crisis is greatly diminished.