Total national healthcare spending in 2018 grew 4.6 percent, which was slower than the 5.4 percent overall economic growth as measured by Gross Domestic Product (GDP), according to a study conducted by the
As a result, the share of the economy devoted to health spending decreased from 17.9 percent in 2017 to 17.7 percent in 2018. Growth in overall healthcare spending has averaged 4.5 percent for 2016-2018, slower than the 5.5 percent average growth for 2014-2015, that was affected by expanded Medicaid and private insurance coverage and increased spending for prescription drugs, particularly for drugs used to treat hepatitis C. The growth in total national healthcare expenditures was approximately 0.4 percentage point higher than the rate in 2017 and reached
According to the report, private health insurance, Medicare, and Medicaid experienced faster growth in 2018. The faster growth for these payers was influenced by the reinstatement of the health insurance tax which was applied to private health insurance, Medicare Advantage, and Medicaid Managed care plans. The health insurance tax was a fee imposed on all health insurance providers beginning in 2014 as a part of the funding for the Affordable Care Act (ACA) and was subsequently amended to institute a one-year moratorium on the fee for 2017.
* Private health insurance spending (34 percent of total health care spending) increased 5.8 percent to
* Medicare spending (21 percent of total health care spending) grew 6.4 percent to
* Medicaid spending (16 percent of total health care spending) increased 3.0 percent to
* Out-of-pocket spending (10 percent of total health care spending) includes direct consumer payments such as copayments, deductibles, and spending not covered by insurance. Out-of-pocket spending grew 2.8 percent to
Health care spending growth was mixed in 2018 for the three largest goods and service categories - hospital care, physician and clinical services, and retail prescription drugs.
* Hospital spending (33 percent of total healthcare spending) increased at about the same rate in 2018 as in 2017, growing 4.5 percent and 4.7 percent, respectively, to reach
* Physician and clinical services spending (20 percent of total healthcare spending) increased 4.1 percent to reach
* Retail prescription drug spending (9 percent of total healthcare spending) grew 2.5 percent in 2018 to
Additional highlights from the report include:
* Sponsors of Healthcare. In 2018, the federal government's spending on health care increased 5.6 percent, accelerating from growth of 2.8 percent in 2017, and was driven by faster growth in the federally-funded portions of Medicare and Medicaid expenditures. Private businesses' health care spending increased 6.2 percent in 2018 due primarily to faster growth in employer-sponsored private health insurance premiums. The federal government and households accounted for the largest shares of spending (28 percent each), followed by private businesses (20 percent), state and local governments (17 percent), and other private revenues (7 percent).
The National Health Expenditure estimates have been revised to reflect the most recent and up-to-date source data that is available (and may not have been available for last year's vintage of the National Health Expenditure Accounts).
The 2018 National Health Expenditures data and supporting information will appear on the CMS website at: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsHistorical.html.