Although healthcare hiring is heating up, spending trends in the sector continue to pursue a moderate path, according to data from Altarum Health's Center for Sustainable Health Spending.
Healthcare spending grew at a 4.9 percent annual clip between August 2013 and August of this year. That's only slightly higher than the growth in gross domestic product (GDP), which was 4.3 percent between July 2013 and July 2014.
Although that growth rate is significantly higher than the below 3 percent annual clip reported early last year, it is below the 5.6 percent growth rate reported in June, and has now declined for two consecutive months. And it remains sharply lower compared to the double-digit spending growth of a decade ago.
Overall healthcare spending reached a seasonally adjusted $3.05 trillion in August. As of July 2014, spending accounted for 17.4 percent of GDP.
Hospital spending led the pack, accounting for $962 billion of all healthcare expenditures, or about 32 percent of the total, and grew at a 4.6 percent annual clip in August, up from slightly more than 3 percent in August of last year. Physician and clinical services represented about 20 percent of overall spending, but rose at a 2.3 percent rate in August, down from 4 percent in August 2013.
But it was spending on prescription drugs that drove a large proportion of spending growth, according to Altarum. Expenditures in that category grew at a 10.6 percent annual rate, or a seasonally adjusted $306.5 billion. Spending in that category is up more than 17 percent over the past three years.
The rate of healthcare spending growth in the U.S. has slowed significantly in recent years, dampened in part by the Great Recession and continued cost-shifting to patients. Overall, Altarum officials have been fairly bearish regarding the long-term spending growth in the healthcare sector, and believe that recent upticks are more of a blip than an indication of a change in trends.
To learn more:
- read the Altarum Institute's report (.pdf)