HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Tuesday, February 9, 2010

Health Care Spending Reaches $2.5 Trillion in 2009 - Up 5.7% Since 2008

Annual government projections have U.S. health care spending reaching $2.5 trillion in 2009--up an estimated 5.7 percent since 2008, despite a projected decline in the gross domestic product (GDP) in the same period. Health Affairs explains that, as a result,  

health care's share of the economy grew 1.1 percentage points in 2009, to a projected 17.3 percent. This represents the largest one-year increase in GDP share since the federal government began keeping track in 1960.

For 2009 through 2019, health spending is expected to grow at an average annual rate of 6.1 percent--1.7 percentage points faster than GDP, the CMS analysts say. During that time, public spending (7.0 percent average annual growth) is projected to continue increasing faster than private spending (5.2 percent average annual growth). Researchers predict that public payers will be paying for slightly more than half of the health care purchased in the U.S. by 2012, compared to 47 percent in 2008.

The 11-year health care spending projections, prepared annually by economists at the Centers for Medicare and Medicaid Services (CMS), reflect the substantial influence of the economic recession on both public and private health care spending as more Americans lose their private health insurance and as federal and state governments face projected increases in Medicaid enrollment and spending.

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