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National health expenditure projections, 1994-2005
1Office of National Health Statistics, Baltimore, MD 21244, USA.
Health Care Financing Review
|February 2, 1996
Summary
U.S. health expenditures are projected to grow faster than the economy through 2005, reaching 17.9% of GDP. Without systemic changes, Medicare and Medicaid will cover an increasing portion of these rising costs.
Area of Science:
- Health Economics
- Healthcare Policy
- Economic Forecasting
Background:
- U.S. health spending growth has slowed since 1990.
- Current healthcare laws and practices are assumed to continue.
- Projecting future healthcare expenditures is crucial for policy planning.
Purpose of the Study:
- To project U.S. health expenditures through the year 2005.
- To analyze the future share of GDP and payment sources for healthcare spending.
- To forecast the impact of existing trends on healthcare finance.
Main Methods:
- Utilized 1993 as a baseline year for projections.
- Assumed continuation of current U.S. healthcare laws and practices.
- Employed trend analysis of annual spending growth and GDP.
Main Results:
- Health spending growth is projected to increase after 1994 but remain below the prior decade's average.
- Healthcare expenditures are expected to outpace GDP growth.
- By 2005, health expenditures are projected to constitute 17.9% of the GDP.
Conclusions:
- Continued growth in health expenditures relative to GDP is anticipated.
- Medicare and Medicaid are projected to fund a larger share of total health spending.
- Systemic changes are implied as necessary to alter these long-term financial trends.
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