; ZZ 120
Documents
Resources
Learning Center
Upload
Plans & pricing Sign in
Sign Out

ZZ 120

VIEWS: 33 PAGES: 5

  • pg 1
									National Spending on Health Care
Health care spending in the United States has grown rapidly since the 1960s, at an average rate of 10 percent a year. In 2006, over $2.1 trillion was spent on health care in the United States. The amount of money spent on health care is expected to increase to nearly $4.3 trillion by 2017.1 Spending on health care accounted for 16 percent of Gross Domestic Product (GDP) in 2006. By 2017, the Center for Medicare and Medicaid Services (CMS) projects that health care will account for about 20 percent of GDP.2
National Health Expenditures (NHE), Aggregate and Share of Gross Domestic Product (GDP), 1960-2017

Source: Source: Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services and U.S. Department of Commerce. (2006-2016 data are projected.)

While health care spending has been increasing, the distribution of health care spending among different services has been changing. Since the 1980s, the percentage of health care spending for hospital care has declined. In 1980, hospital care accounted for 40 percent of all health care spending. By 2004, it accounted for 30 percent, and is expected to remain at roughly 31 percent between now and 2017.3

By contrast, the share of spending for physician and other professional services rose over the same time period, from 27 percent of in 1980 to 28 percent in 2005. It is expected to fall slightly to 26 percent through 2017.4 The share of health care spending accounted for by prescription drugs increased from 5 percent in 1980 to 10 percent in 2005, and is expected to reach 12 percent in 2017.5
Distribution of National Health Expenditures, by Type of Expenditure, 19602017

Source: Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services. (2006-2017 data are projected.)

The share of private health care spending that health insurance covers has more than doubled since the 1960s. In 1960, health insurance paid covered 36 percent of private health spending, while individuals covered the remaining 64 percent out of their own pocket. By 2006, health insurance accounted for 77 percent of private health spending, while out-of-pocket spending accounted for 23 percent of spending.6

Out-of-Pocket Spending as a Percent of Total Private Spending, 1960-2017

Source: Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services. (2006-2017 data are projected.)

The cost of providing health care services has been increasing faster than the Gross Domestic Product (GDP) since 1998, but the gap between the two declined recently as the economy recovered from recession and health care costs grew more slowly. During 2001, health care costs increased 11.3 percent, while GDP increased by only 2.1 percent. By 2006, health care costs increased 7.7 percent, compared to 5.9 percent GDP growth.7
Annual Growth Rates for Spending on Health Care Services and Gross Domestic Product (GDP), 1998-2006

Source: Bradley C. Strunk, Paul B. Ginsburg, and John P. Cookson. "Tracking Health Care Costs: Declining GrowthTrend Pauses In 2004." Health Affairs Web Exclusive, June 21, 2005; and Ginsburg, Paul B., Bradley C. Strunk, Michelle I. Banker, and John P. Cookson. "Tracking Health Care Costs: Continued Stability But At High Rates In 2005." Health Affairs Web Exclusive, Oct. 3, 2006.

Recent spending on health care services has slowed for all categories of health care, but cost increases for hospital outpatient services and prescription drugs continue to outpace those for inpatient and physician services.
Annual Per Capita Percentage Change in Health Care Services, by Category of Service, 2001-2006

Source: Bradley C. Strunk, Paul B. Ginsburg, and John P. Cookson. "Tracking Health Care Costs: Declining GrowthTrend Pauses In 2004." Health Affairs Web Exclusive, June 21, 2005; and Ginsburg, Paul B., Bradley C. Strunk, Michelle I. Banker, and John P. Cookson. "Tracking Health Care Costs: Continued Stability But At High Rates In 2005.." Health Affairs Web Exclusive, Oct. 3, 2006.

Sources
1

Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services and U.S. Department of Commerce.

2

Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services and U.S. Department of Commerce. Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services. Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services. Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services. Employee Benefit Research Institute estimates from Centers for Medicare and Medicaid Services.

3

4

5

6

7

Strunk, Bradley C., Paul B. Ginsburg, and John P. Cookson. "Tracking Health Care Costs: Declining Growth Trend Pauses In 2004." Health Affairs Web Exclusive, June 21, 2005; and Ginsburg, Paul B.,

Bradley C. Strunk, Michelle I. Banker, and John P. Cookson. "Tracking Health Care Costs: Continued Stability But At High Rates In 2005." Health Affairs Web Exclusive, Oct. 3, 2006. Please note that EBRI's analysis defines children as individuals ages 0-17, whereas other sources may define children as ages 0-18. This difference accounts for the variance between the reported numbers of uninsured children, depending on the source and method of analysis.


								
To top
;