Industry News

On December 5, 2019, the Centers for Medicare & Medicaid Services (CMS) released their report on the National Health Expenditure Accounts (NHEA).  The NHEA measures annual U.S. expenditures for health care goods and services, public health activities, government administration, net cost of health insurance, and investments related to health care.  According to the CMS, U.S. health care spending grew 4.6% in 2018 and reached $3.6 trillion or $11,172 per person.  As a share of the gross domestic product (GDP), health care spending was 17.7% in 2018, down from 17.9% in 2017.

In 2018, health care spending for the broad categories of services and products include:

• Hospital care spending increased 4.5% to $1.2 trillion, down from 4.7% in 2017;
• Physician and clinical services increased 4.1% to $725.6 billion, down from 4.7%;
• Other professional services increased 6.5% to $103.9 billion, up from 5.2%;
• Dental services increased 4.6% to $135.6 billion, up from 3.8%; and
• Prescription drugs increased 2.5% to $335.0 billion, up from 1.4%.  

In 2018, households accounted for 28% of total health care spending; the federal government accounted for 28%; private businesses (including the employer’s share of health insurance premiums) accounted for 20%; and state and local governments accounted for 17%, and other private revenues accounted for 7%.  The growth in federal government spending increased 5.6% in 2018, up from 2.8% in 2017.  The federal government’s increased spending for health care is mainly due to faster growth in the federally-sponsored portions of Medicare and Medicaid expenditures.  

Further information is available here.