State Cost Growth Benchmark Programs and Total Medical Expenditures, 2010 to 2020

US health care spending continues to outpace economic growth, prompting states to implement cost-growth benchmark programs aimed at constraining expenditure growth. However, empirical evidence evaluating their associations with overall spending growth remains limited.

To evaluate whether adoption of statewide cost-growth benchmark programs is associated with changes in per capita total medical expenditure (TME) growth.

This cohort study used a quasi-experimental, difference-in-differences analysis with 2-way fixed effects to examine data from the Centers for Medicare & Medicaid Services State Health Expenditure Accounts from January 1, 2010, to December 31, 2020. A total of 561 state- and year-level observations across 50 states and Washington, DC, were analyzed. Statistical analysis was performed from January 2025 to April 2026.

Adoption of statewide cost-growth benchmark programs in Massachusetts (2013), Maryland (2014), Vermont (2018), Rhode Island (2019), and Delaware (2019); all states paired their benchmark programs with enforcement mechanisms and/or payment reforms except for Delaware, which relied solely on public reporting.

The primary outcome was log-transformed per capita TME growth. Secondary outcomes included changes in payer-specific and spending category-specific expenditures.

Across all 50 states and Washington, DC, the mean annual per capita TME increased by 3.7% during the study period. Implementation of cost-growth benchmark programs was associated with a 2.0% reduction in TME growth (95% CI, -3.3% to -0.7%; P = .004). Reductions were observed in all treatment states except Delaware. Medicare spending growth decreased across all treatment states (-2.4%; 95% CI, -4.2 to -0.6; P = .009), whereas reductions in commercial spending growth were concentrated in Maryland (-2.2%; 95% CI, -3.6 to -0.8; P = .003) and Rhode Island (-18.3%; 95% CI, -20.3% to -16.2%; P < .001). Spending reductions were primarily driven by decreases in hospital (-5.3%; 95% CI, -7.3% to -3.3%; P < .001) and skilled nursing facility expenditures (-7.7%; 95% CI, -10.5% to -4.9%; P < .001), alongside concomitant spending increases in home health spending (8.9%; 95% CI, 3.2% to 14.8%; P = .002). Findings were robust to multiple sensitivity analyses.

This cohort study found that state cost-growth benchmark programs were associated with modest reductions in health care spending growth. These findings suggest that benchmark programs, particularly those paired with enforcement mechanisms or payment reforms, may contribute to slowing expenditure growth and shifting care toward lower-cost settings.