Healthcare spending is expected to balloon to $8.3 trillion by 2040, which is $3.5 trillion less than a federal government estimate, a new report from consulting firm Deloitte finds.
The reason for the discrepancy is that consumers will take a more active role in their healthcare and therefore help curb spending, including by getting early signals of disease and addressing them proactively, according to the report released Monday.
“We anticipate that emerging technologies, an ability to cure and prevent disease (or detect disease in the earliest stages), and highly engaged consumers will lead to a deceleration of health spending between now and 2040,” the report said.
The Centers for Medicare & Medicaid Services’ (CMS') Office of the Actuary predicted prior to the COVID-19 pandemic that healthcare spending would grow by 5.3% each year and reach a massive $11.8 trillion in 2040. In 2019, healthcare spending was $3.8 trillion and represented nearly 18% of America’s gross domestic product.
“Although the pandemic caused people to defer care throughout much of 2020, a rebound and then continuation of the trends beyond 2021 would drive healthcare spending to historic levels in the coming years,” Deloitte said.
But Deloitte claims there could be a $3.5 trillion “well-being dividend” that would be the difference between their estimate of $8.3 trillion in healthcare spending by 2040 and CMS’ $11.8 trillion figure.
The dividend will represent the return on investment in new business models that integrate data to improve a consumer’s well-being.
An example of this is data sharing between health plans and clinicians. Advances in interoperability can help create a “system where data is securely shared among stakeholders to create a multifaceted and highly personalized picture of every consumer’s well-being,” the report said.
Deloitte also predicts that consumers are going to take a more active role in their healthcare since they have access to more highly personalized health information.
“Ownership of their health data can increase people’s sense of responsibility for their well-being,” the report said.
The COVID-19 pandemic could also lead to new scientific breakthroughs as researchers were forced to rely on more digital technology for clinical trials.
“Some regulatory processes have been streamlined to make it easier to get diagnostic tests and therapies to market more quickly,” Deloitte said. “During the next 20 years, we expect new preventive and curative advances will emerge at an exponential pace.”