Healthcare spending growth took a slight uptick over the past year, according to a new report.
The latest monthly spending brief (PDF) from Altarum Institute shows that spending grew by 5.2% between June 2017 and June 2018, compared to 4.2% the year prior. By comparison, the nation’s gross domestic product grew by 4.9% in that same window; healthcare spending accounts for 17.9% of GDP.
Americans spent $3.66 trillion on healthcare in the first five months of the year, according to the report, which is an increase of just under 1% from projections of $3.61 trillion in spending. Altarum attributes that uptick to an increase in spending on hospital care, which accounts for about 32% of spending overall.
“As a fraction of GDP, we’re about where we were,” George Miller, Ph.D., Altarum fellow and one of the report’s authors, told FierceHealthcare, “but we’re spending and growing more than we expected."
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The figures align with projections from the Centers for Medicare & Medicaid Services, which issues both a retrospective and prospective spending report each year. In February, CMS’ Office of the Actuary estimated that healthcare spending could increase by 5.5% annually and reach $5.7 trillion by 2026.
CMS estimated in its 2017 projections that growth in healthcare spending would outpace GDP growth, a trend it expects to continue through 2026 and is reflected in Altarum’s findings.
As of June, spending on hospital care has reached $1.173 trillion, significantly outpacing the next largest spending category: physician services, at $733 billion or 20% of spending, according to Altarum. Spending on drugs accounted for 10%, or $355 billion.
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Though spending on hospital care makes up a large chunk of spending overall, growth in such spending is on par with the year prior; growth rates were just under 4% in June 2017 and just over 4% in 2018.
Far larger gaps in spending were recorded in dental care and nursing home care. Dental care spending growth increased the most overall between June 2017 and 2018, jumping by 7.7%. By comparison, spending on dental care increased by about 3% between June 2016 and 2017.
Spending on nursing home care increased by about 6% over the past year, compared to just over 2% the year before.
Altarum uses data from the Bureau of Economic Analysis, figures that typically align with CMS’ data, and Miller said that BEA issued a five-year “benchmark” update in July—changes that are also likely to be reflected in CMS’ forthcoming updates to its own projections.