The Centers for Medicare and Medicaid Services (CMS) reported in Health Affairs yesterday that national health spending is expected to grow at an average of 5.8 percent annually from 2014-2024. CMS cites the coverage expansions under the Affordable Care Act, anticipated economic growth, and an aging population as the major drivers of the increase. However, according to an American Hospital Association bulletin, the Centers’ actuarial division emphasized that these projected growth rates are significantly lower than those observed over the three decades prior to the Great Recession. For the next decade, the report predicts that health spending will grow 1.1 percent faster than gross domestic product per year, raising the health care share of GDP from 17.4 percent in 2013 to 19.6 percent by 2024. CMS projects health care spending to have grown 5.5 percent in 2014, primarily due to insurance coverage expansions and a sharp rise in prescription drug spending. Current estimates on such prescription drug spending increases reveal the significance – from 2.5 percent in 2013 to 12.6 percent in 2014.
Access the report via Health Affairs here.