Maybe its too early to get really excited because one month does not make a trend and the cost of healthcare only dropped one tenth of one percent between June and July. But still, a decrease in the cost of healthcare is a big deal. This has been the one constant in the economy that everyone could count on. Healthcare costs will always increase from month to month. We have only had a decrease like the one last month six times in the last 63 years. Maybe longer since records only go back to 1947. And the last time it happened was 35 years ago.
On the other hand maybe it is time to celebrate, at least until the August numbers come out. Of course I would feel better if we knew exactly why there was a decrease. No one seems to be able to explain that. All we know is that healthcare did buck the overall trend which showed a consumer spending increase increase of 0.3% between June and July. The Obama administration has not yet claimed this as a victory for healthcare reform. Nor have the Republicans stated that this is the beginning of Americans abandoning our current healthcare system out of fear. People like us at Compirion would like to think it is because we are helping hospitals improve their operating metrics. But the truth is that the decrease is too small to be statictically significant, at least based on one month's data.
Lets continue to look at this and see what the future months bring.
More on this later.
Mark Brodeur
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