Industry News

On December 14, 2022, 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 2.7% in 2021 and reached $4.3 trillion, which was slower than the increase of 10.3% in 2020. As a share of the gross domestic product (GDP), health care spending increased 10.7% in 2021.  

In 2021, health care spending for the broad categories of services and products include:

• Hospital care spending increased 4.4% to $1.3 trillion, down from 6.2% in 2020;
• Physician and clinical services spending increased 5.6% to $864.6 billion, down from 6.6% in 2020; and
• Retail prescription drug spending increased 7.8% to $378.0 billion, up from 3.7% in 2020. 

In 2021, the growth in federal government spending decreased 3.5%, compared to an increase of 36.8% in 2020. The federal government’s decreased spending for health care is mainly due to a reduction in federal COVID-19 funding, and to a lesser extent, a decrease in federal public health expenditures and a decline in federal Medicaid funding. Private businesses’ health care spending increased 6.5% in 2021, up from 2.9% in 2020; households’ health care spending increased 6.1% in 2021, up from 1.2% in 2020; and state and local government health care spending increased 5.8%, up from 1.9% in 2020. 

Further information is available here.