Medical care costs: trends and outlook

Data on health care expenditures continue to show favorable developments in terms of restraining spending. The growth in spending has eased significantly, particularly for hospital care and physicians' services. Spending in the health care sector has remained relatively flat in relation to the nation's economy, reflecting significant changes to the delivery and financing of medical care. Although coming under some pressure, managed care, especially the health maintenance organization (HMO), continues to exert a dominant influence in changing the landscape of medical care in the United States. Through Medicare and Medicaid, government is expanding its role in medical care. However, indications are that spending growth has begun to trend upward. Estimates by the Health Care Financing Administration show that the health care sector's utilization of the nation's resources will once again move to an upward track.