Health Affairs Web First: Health Spending Growth Projections, 2016 –25

New estimates released today from the Office of the Actuary at the Centers for Medicare and Medicaid Services (CMS) project an average rate of national health spending growth of 5.6 percent for 2016–25, outpacing average projected growth in gross domestic product (GDP) by 1.2 percentage points. As a result, the health share of the economy is projected to climb to 19.9 percent by 2025—up from 17.8 percent in 2015. These projections are constructed using a current-law framework and do not assume potential legislative changes over the projection period. Growth in national health spending is expected to be driven by projected increases in medical prices from a recent historic low of 0.8 percent in 2015, to nearly 3.0 percent by 2025. Growth in the use and intensity of medical services, however, is projected to slow relative to that experienced in 2014 and 2105, as the impacts of the Affordable Care Act’s coverage expansion wane and enrollment growth in Medicaid and private insurance slows. Changes in the age and sex distribution of the population are projected to consistently put upward pressure on growth throughout the projection period, contributing an average of about 0.5 percentage point to growth per year. Every year the CMS Office of the Actuary releases an analysis of how Americans are expected to spend their health care dollars in the years ahead. The projected average growth rate for 2016-25 (5.6 percent) reflects the latest expectations from the Office of the Actu...
Source: Health Affairs Blog - Category: Health Management Authors: Tags: Elsewhere@ Health Affairs Web First Source Type: blogs