When the embargo lifts. Okay. In this chart, we put into context the relationship between Health Spending and Economic Growth. And namely, the effective economics on projected Health Spending is an overarching theme of our paper. And as you can see, looking at nhe growth, both historical and projected, which is the blue dash line and nominal gdp growth which is the red dotted line. Youll see that theyve been growing at similar rates since 2010. And they are projected to do so in 2013, as well. Growth is projected to accelerate in 2014 as ive alluded to due to the coverage expansions under the aca. However, in 2015 and after, the historical relationship between Health Spending and Economic Growth which is that Health Spending tends to respond to changes in Economic Growth with a lag becomes more evident. While projected Economic Growth reaches a peak in 2018. We project that growth will reach a peak in 2020. Also, contributing to the acceleration in growth during that period for Health Spending is faster projected medicare spending growth. Which reflects both the effect of faster enrollment by the baby boom generation and faster for beneficiary spending growth as the population ages. So taken over the entire projection period, nhe growth is projected to increase 1. 1 Percentage Points faster than gdp on average. And so, to translate those relative growth rates into the effect on the health share of gdp, which is the purple line in our chart, because nhe and gdp have been growing at similar rates since 2010 and are expected to do so again for 2013, the health share has remained relatively stable since 2010. And again, is accordingly projected to do so in 2013. In 2014 and after, the Health Shares expected to rise as projected nhe growth further outpaces Economic Growth due to the effect of the coverage expansions faster projected Economic Growth and the aging of the population. And so, over the projection period, the health share of gdp is projected to rise from 17. 2 in 2012 to 19. 3 by 2023. And, again, to help to put the projected acceleration in nhe growth that ive been discussing into context, its important to remember another of our major findings, which is that while growth is projected to acceleration during the projection period, those growth rates are slower than experienced over the last two decades. Projected Health Spending growth is slower on average over the entire projection period by about 1. 5 Percentage Points. And thats comparing the growth rate of 7. 2 to the 5. 7 per year on average growth rate for the projection period. In addition, its also important to note that the projected growth during the key time periods of acceleration are also slower than experienced over the last two decades. And so that would be for 2014 and 2015, the first two years of the Affordable Care act coverage expansions as well as over the 2016 through 2023 period. Which is due to the effect of faster projected Economic Growth and the effect of population aging. Over the next three slides, ill provide a highlevel overview of our findings by servicing good, payer and sponsor. And then shawn will take you through a more detailed look at these points over the second half of the presentation. By servicing good, the distribution of Health Spending is not expected to change much over the projection period. With a projected shares of Health Spending devoted to the three largest sectors, hospitals, physician and Clinical Services and prescription drugs remaining the same by 2023. How we arrive there in terms of projected spending growth during each time period for the Major Services, however, does differ. Following continued projected growth in 2013, spending for each of the major sectors is projected to grow faster in 2014, the first year of the coverage expansions. Continued robust spending growth is expected for the Major Services over the remainder of the projection period due largely to the continued effect of the expansions, faster Economic Growth, the aging of the population and for drugs higher expected use of specialty drugs. The exception is the projected slowdown in growth for physician and Clinical Services in 2015. And this is attributable to the expiration of increased medicaid payments for physicians and lower payments to advantage plans. And now for our trends by payer. The effect of the coverage expansions starting in 2014 and the aging of the population are the two key trends evident in the projected spending trends by payer. The availability of expanded coverage through mid cade in states that choose to participate is expected to contribute to an crease in the shared Health Spending by two Percentage Points over the projection period to about 18 . Despite the presence of new enrollment in private Health Insurance plans through the coverage expansions and faster Economic Growth driving faster private Health Insurance spending growth in 2014 and after, the aging of the baby boom generation out of private Health Insurance and into medicare is expected to result in a decline in the private Health Insurance share of Health Spending from 33 to 32 . Correspondingly, the medicare share of spending is projected to increase from 20 to 22 over the projection period. Additionally, the share of the population comprised of medicare enrollees is expected to rise, as well, from 15. 8 to 19. 8 over the projection period. And expanding coverage and the trend into medicare out of pocket spending is projected to decline in share of total Health Spending from just under 12 in 2012 to just under 10 by 2023. And finally, ill take you through the trends by sponsor or ultimate source of financing for health care. And, again here, the effect of the coverage expansions and the aging of the population play a major role. The coverage expansions through medicaid, the 90 to 100 federal matching rates for states that and premium for marketplace plans are expected to increase the share of Health Spending sponsored by the federal government over the projection period. Correspondingly, these factors are expected to contribute to the decline in the household share of spending over the projection period. Also contributing to the increase in the federal share and the decline in the household share is the shift of the baby boom generation into medicare. It also plays a key role in a projected decline in the share of Health Spending, financed by businesses. And finally, by 2023, the share of health care financed by federal, state and local governments is expected to rise to 48 of Health Spending from 44 in 2012. And with that, ill turn the presentation over to shawn who will take you through the key findings by time period. Thank you very much. Okay. Thanks, andrea. I first want to thank everybody here in the room and anybody watching on tv or online for your interest in our work. We really appreciate it. Were happy to answer any questions you guys have after the presentation. Id also like to reiterate what andrea said and thank Health Affairs for their help in getting this paper published. And weve really had a great relationship over the years and certainly has continued this year. And i just really wanted to quickly point out one thing, which i think is a new innovation that at least i havent seen before. If you look at line charts and economic writings, you see recession bars all the time. The first time, at least what ive seen, youve seen a recovery bar. And ill discuss the significance of this in my first slide. But, again, thank you very much for everything and your staff. I think it really worked out great this year. Okay, so as andrea mentioned, im going to break this period down to three distinct time periods. And the first time period is 2013. And the first thing i want to mention is 2013 is still a projection. Later in a few months, our office is going to come out with historical estimates of Health Spending. But until that happens, 2013 is a projection. And as andrea mentioned, we are projecting 3. 6 Health Spending growth in 2013, which would mark the fifth Consecutive Year of growth under 4 . Gdp growth is estimated by the bureau of Economic Analysis for 2013 at 3. 4 . And so since these growth rates are similar, if this would mean that the share of gdp or the health share of the economy is projected to remain constant in 2013 at 17. 2 . Now, heres where i want to bring back in exhibit 2 and the value of it. In that andrea mentioned the relationship, the important relationship between Health Spending and Economic Growth. And this exhibit shows the recovery, the four years of the recovery for each of the last two recessions. And in 2013, the fourth year after the recession ended as i mentioned before, gdp was 3. 4 . And if you look at exhibit 2. It was much higher at around 6 for each of the last two recessions. Again, it was an important finding that its not its not primarily the recession the recovery from the recession which has been slower for this recession than past recessions, which is one factor leading to slower Health Care Spending growth. Okay. Now im going to break out 2013 by payer. And for medicare, were expecting growth to slow to 3. 3 . And this is as a result of Slower Growth and utilization across all types of services, but also lower projected growth from sequestration, which many of you know is caught for lower payments about 2 beginning in april, 2013 as a result that was included in the budget control act of 2011. For medicaid, were projecting growth at 6. 7 . And this slide gives a fouryear growth rate. And so it kind of masks the acceleration in 2013 because 2012 growth was just 3. 3 . And so it was a faster acceleration. Part of this was due from a rebound from a 2012 low. But the other part of it was aca mandated temporary payment increase to primary care physicians that was one factor in the higher spending growth projected for medicaid. For private Health Insurance, were expecting lower projected growth of just 3. 3 . In addition to having more people and High Deductible Health plans at the same time, in an environment of low Economic Growth. And as far as by by sector for hospitals, growth is projected to slow to 4. 1 . This subpoena mainly due to utilization, especially medicare utilization. Obviously impacted by sequestration. For physician, growth is projected to slow to 3. 3 . But the reason for the slowdown is the primary reason for the slowdown is different in that we are projecting they will be the slowest thats been in 2013 since 2002. Slow price growth was the main reason for the slowdown in physician and Clinical Services spending. For prescription drugs, were expecting acceleration. And this is coming off a low of 0. 4 in 2012. Mainly due to a large number of topselling brand name drugs that lost patent protection in 2012 or the last part of 2011 so the impact was felt mostly in 2012. That really kept spending growth down in 2012. And so in 2013, there was some additional brand name drugs that lost patent protection, but there wasnt as many, a lower dollar value of drugs that lost patent protection. That didnt push down growth as much. So there was, i guess, thatst the primary reason for the acceleration. The next period im going to discuss is 2014 and 2015 which are the two years that youre going to see the major impact of the coverage expansions. For medicaid and private Health Insurance, higher growth is of 12. 8 for medicaid and 6. 8 for private Health Insurance due to higher use as a result of the coverage expansions where were expecting a reduction in the uninsured of 9 million in 2014. In 2015, were expecting additional 8 million reduction in the uninsured which is going to keep private Health Insurance growth strong at 6. 9 . For medicaid, were projecting a slowdown in growth of 6. 7 where the increase in coverage, the further increase in the coverage expansions, higher enrollment is going to be projected to be slightly offset by the expiration of the temporary increase in payments to medicare. Excuse me, the medicaid primary care physicians. Okay. So for out of pocket, we are expecting negative growth in 2014 and then low growth in 2015 as a result of the coverage expansions. People moving from uninsured where they pay 100 out of pocket to having Insurance Coverage. And some of that Insurance Coverage is going to have cost sharing subsidies which further reduces the out of pocket burden. For medicare, then in 2014, were expecting continued slow growth in use and in payments, which is keeping growth slow. But then in 2015, were actually projecting a further deceleration, 2. 7 . And the deceleration here is partially attributable to lower payments to Medicare Advantage plans. Now, by sector in this period, hospital is projected to gradually accelerate to 4. 5 in 2014 and 5. 1 in 2015. And this is as a result of increases in use due to the coverage expansions. For physician and Clinical Services, the acceleration is projected to be stronger the 5. 9 , as people that gain coverage are expected to use more physician and Clinical Services than hospital care as they get used to their new coverage. For 2015, though. Growth is projected to decelerate as andrea mentioned as a result of not just the temporary medicaid payment increases, but also the lower payments of the Medicare Advantage plans in that year. For drugs, were expecting higher use because of the coverage expansions. Not just the but also the folks that had less coverage and moved in 2014 to more generous coverage with cost sharing for drugs. Thats certainly, were projecting to contribute to higher use. Also not just impacting 2014, but 2015 growth is the expensive new hepatitis c treatments that has certainly made news lately that have certainly impacted 2014 and 2015 growth in drug spending. So the final time period im going to discuss is the final eight years of our projection period, 2016 to 2023. For medicare, were expecting average growth of 7. 3 . So the first factor here is continued strong enrollment growth of about 3 . But also; were expecting faster growth of 4. 3 . Which would be higher than what has been experienced in the recent past this is as a result of modest increases in use and modest increase in payment rates. Not getting as high as its been but coming off the low of the past few years. For medicaid, were expecting 6. 8 average annual growth during this period. And here overall enrollment is projected to stabilize. The subpopulation also the most expensive to cover in that population. And finally, in this slide, private Health Insurance growth is projected to be lower than medicaid and medicare at 5. 4 but also this is this growth rate would be higher than it has been in the recent past. And this is as a result of faster projected Economic Growth leading to higher use of services than weve seen in the recent past. By sector, andrea mentioned or showed the distribution slide and we saw that the distribution for the Major Services. And so therefore, we can expect that the growth rates will be similar. And thats what weve found. Thats what you can see in this slide. Hospital and physician growth is expected to be driven, again, by modest increases in use of these services as a result of not just improved economic nations but also population aging. Prescription drug spending is expected to be to be 5. 7 average during this period, a little bit lower than the other sectors. Here, were still expecting that majority of use of drugs will still be generics. However, the growth is projected to be driven by the expense of specialty drugs approved during this period. Health spending growth is expected to be slowed in 2014. And afterwards, 2014, 2015, growth is projected the be influenced by the coverage expansions. And then afterwards, growth is projected to be influenced by a faster Economic Growth as well as population aging. The growth rate that were projecting is would be higher than the recent past, but much lower than the previous two decades. And so, you know, were not projecting that growth will get back to the rapid pace of the 90s and early 2000s. We are projecting 1 Percentage Points of a differential between gdp growth, which would mean its expected to rise between 17. 2 in 2012 to 19. 3 by 2023. Okay. So with that, i guess, well take questions. We