States have tools to slow healthcare spending growth, new UCLA Health report finds
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August 14, 2026
By Gretchen McCartney
2 min read
Across the United States, the cost of healthcare continues to climb faster than inflation and wages. But states that enact policies to cap healthcare spending growth can slow that growth – if they build in penalties and other accountability measures, according to a new UCLA Health report that analyzed medical spending nationwide from 2010 through 2020.
Between 2013 and 2019, five states implemented cost-growth programs: Massachusetts, Maryland, Vermont, Rhode Island and Delaware. The programs set targets for how much healthcare spending should grow yearly and publicly tracked whether those targets were met. In four of the five states, the policies worked; healthcare costs still grew, but they grew 2 percent less the national average of 3.7 percent.
“While the reductions we observed were modest, even small decreases in spending growth can translate into substantial savings over time,” said Aleena Imran, a student in the David Geffen School of Medicine at UCLA, who led the study published June 29 in the journal JAMA Network Open.
“Healthcare costs are often viewed as a federal issue, but our findings suggest states also have a meaningful role to play in improving affordability,” Imran added
The four states that stemmed cost growth had paired the caps with levers like penalties and hospital price constraints. Only Delaware, which didn’t implement any penalties to enforce spending limits, saw no change in healthcare spending.
“The policy design really matters. The accountability structure determines whether they translate into meaningful spending changes,” said co-author Dr. John N. Mafi, an associate professor-in-residence of medicine in the school’s division of general internal medicine and health services research.
The data analyzed was from the Centers for Medicare & Medicaid Services State Health Expenditures Accounts from Jan. 1, 2010 to Dec. 31, 2020.
The findings also suggest that slowing healthcare spending doesn’t necessarily lead to cutting healthcare services, the authors said. Their analysis found the largest reductions were in hospital and nursing home spending growth, while spending growth on home health services increased. Some care may have shifted from higher- to lower-cost settings.
The researchers cite a recent national report that found U.S. healthcare spending growth has consistently outpaced economic growth, with per capita spending projected to exceed $24,000 by 2033 – totaling $8.6 trillion nationally.
“CMS projects national health expenditures will reach approximately $8.6 trillion by 2033.”
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