Health Care Spending Expected to Increase, According to Latest CMS Figures
February 14, 2018
National health care spending is expected to increase to $5.7 trillion and comprise nearly 20% of the Gross Domestic Product by 2026, according to the latest statistics reported today by the Centers for Medicare and Medicaid Services. The numbers, released in conjunction with health policy journal Health Affairs, indicate that the increase in spending is a result of “economic and demographic factors: changes in projected income growth, increases in prices for medical goods and services, and enrollment shifts from private health insurance to Medicare that are related to the aging of the population.”
National Pharmaceutical Council Chief Science Officer Robert Dubois, MD, PhD, said that spending more on health care does not mean that we are spending our dollars well.
As in previous years, the two primary drivers of growth in personal health care spending during the projection period are medical prices and use and intensity of services. Out-of-pocket spending also is expected to increase, but with wages remaining mostly stagnant, these costs will fall hardest on lower income populations.
David Cutler, the Otto Eckstein Professor of Applied Economics, Harvard University, who wrote a related article on the CMS figures for Health Affairs, said even though the expected growth in spending is modest, he remains especially concerned about the impact of those out-of-pocket costs.
To better understand what’s at the root of health care spending and the kinds of investments and trade-offs we might need to make, the National Pharmaceutical Council has launched a research-driven national dialogue, “Going Below the Surface.” As part of the dialogue, NPC is supporting a series of papers and blog posts in Health Affairs, the leading peer-reviewed health policy journal, along with a recent conference, Health Spending: Tackling the Big Issues.