Analysts Say U.S. Health Care Spending Grew 3.9 Percent in 2011

Growth Percentage Holds Steady for Third Straight Year

January 09, 2013 01:40 pm News Staff

According to analysts at CMS' Office of the Actuary, growth in U.S. health care spending in 2011 remained at 3.9 percent for the third consecutive year. Findings from a compilation of 2011 national health expenditure data were published in an article( (abstract) in the January issue of Health Affairs.

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Authors reported that health care spending in the United States in 2011 totaled $2.7 trillion, or $8,680 per person. They calculated the health spending share of the country's gross domestic product at 17.9 percent, or the same percentage as in 2009 and 2010.

Hospital spending -- tallied at more than $850 billion in 2011 -- accounted for about 31 percent of total health care spending. In addition, the authors found that in 2011, the federal government financed 28 percent of U.S. health care spending, at nearly $745 billion.

Significant areas where the growth of health care spending slowed in 2011 included Medicaid spending (2.5 percent compared to 5.9 percent growth in 2010) and hospital spending (4.3 percent compared to 4.9 percent growth in 2010).

story highlights

  • U.S. health care spending grew by 3.9 percent in 2011, which mirrored growth rates recorded in 2009 and 2010.
  • Spending increased in some areas, such as costs for Medicare patients, prescription drugs and consumer out-of-pocket expenses.
  • A number of factors, including an increase in the number of insured Americans, could lead to more health care spending in the future, according to analysts.

The report also noted that in 2011, health care spending accelerated in certain areas, including

  • retail prescription drugs (2.9 percent compared to 0.4 percent growth in 2010),
  • physician and clinical services (4.3 percent compared to 3.1 percent in 2010),
  • Medicare spending (6.2 percent compared to 4.3 percent in 2010),
  • private health insurance (3.8 percent compared to 3.4 percent in 2010) and
  • consumer out-of-pocket expenses (2.8 percent compared to 2.1 percent in 2010).

In a Health Affairs( blog posted on Jan. 7, author Chris Fleming, the social media manager at Health Affairs, noted that the 3.9 percent growth rate for three years running indicates that growth in U.S. health care spending occurred at the "slowest rates ever recorded in the 52-year history of the National Health Expenditure Accounts."

Fleming pointed out that at a media briefing on Jan. 7, CMS Chief Actuary Rick Foster indicated that more individuals soon would be covered by health insurance because of implementation of the Patient Protection and Affordable Care Act; that fact, coupled with the propensity of insured patients to use more health care services, could increase health care spending down the road.

Foster acknowledged that some consumers have put off elective health care as a result of economic hard times, and he noted that "pent-up demand" also could fuel spending growth. "I think it's fair to say that there is a tremendous amount of uncertainty about all of this," Foster was quoted as saying in the blog.