2019 Edition — Health Care Costs 101

Spending keeps growing

Katherine Wilson, Wilson Analytics


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Who paid for health care over the past 50 years? Learn more.
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US health spending reached $3.5 trillion in 2017, or $10,739 per capita, and accounted for 17.9% of gross domestic product (GDP). National health spending grew 3.9% in 2017, its slowest pace since 2013. Health spending and the economy grew at similar rates in 2017.

Looking ahead, health spending is projected to grow at an average rate of 5.5% per year between 2018 and 2027, faster than the economy’s 4.7% growth. By 2027, health care spending is expected to total $6.0 trillion and account for nearly one-fifth of GDP.

Health Care Costs 101: Spending Keeps Growing, which relies on the most recent data available, details how much is spent on health care in the US, which services are purchased, and who pays. (Visit CHCF’s interactive infographic to find out who has paid for health care over the past 50 years.)

Key findings include:

  • The slowdown in 2017 health spending was attributable to slower growth in spending for hospital care, physician services, and prescription drugs.
  • Prescription drug spending, which totaled $333 billion in 2017, grew 0.4% in 2017, its lowest rate since 2012. The 2017 slowdown was driven largely by changes in the use and mix of drugs prescribed.
  • Per capita health spending increased 3.2%.
  • Households and the federal government each accounted for 28% of health spending in 2017. Private business accounted for 20%.
  • Federal subsidies for ACA marketplace (individual coverage) premiums and cost sharing totaled $41 billion, accounting for 4% of federal health spending.
  • Household spending on direct purchase insurance declined by 6.7%, driven by declining enrollment in unsubsidized individual insurance.
  • Public health insurance, including Medicare and Medicaid, paid the largest share of spending (41%). Private health insurance paid for 34% of health spending, and consumers’ out-of-pocket spending accounted for 10%.

The full report, a quick reference guide, the data file, and all of the charts in the report are available for download below. These materials are part of CHCF’s California Health Care Almanac, an online clearinghouse for key data and analyses describing the state’s health care landscape. See our entire collection of current and past editions of Health Care Costs 101.