The recent slowdown in health care costs matters a lot for the federal government, which buys health benefits for tens of millions of Americans. It also turns out to matter significantly for retirees.
For the past decade, the Wall Street Journal reports, this number has increased by about 6 percent annually. So to see it drop isn't exactly normal. It's largely due, Kelly Greene writes, "to lower-than-expected Medicare spending in recent years, as well as a reduction in projected Medicare spending in the near future" and "smaller payment increases to hospitals, doctors and health plans."
Even with Medicare coverage, American seniors do end spending a significant amount on medical bills. This chart from the Fidelity report shows that retirees over 65 spend more on health care than food:
A quarter of all Medicare beneficiaries spend all their assets on health care in their last five years of life. While Medicare does provide coverage to seniors, there is still a significant amount that the program does not cover, left over for seniors to pay.