U.S. Health Care Costs Skyrocketed to $3.65 Trillion in 2018
A new analysis from U.S. federal government actuaries say that Americans spent $3.65 trillion on health care in 2018, according to a report from Axios. The amount is larger than the GDPs of such countries as Brazil, the U.K., Mexico, Spain, and Canada.
The level of spending is by far the highest in the developed world, according to data from the Organization for Economic Co-Operation and Development.
That was an increase of 4.4% over 2017 and, according to the analysis, things will get even worse. The report in the journal Health Affairs estimates an average annual growth rate of 5.5% from 2018 to 2027. The current inflation rate is 1.6%. Wage growth, while up from recent years, remains below 4%, according to the Federal Reserve Bank of Atlanta. At this rate, by 2027, health care will be 19.4% of the country’s entire GDP.
The $3.65 trillion in spending represents $11,212 per person, with 59% of the spending going to hospitals, doctors, and clinical services. Prescription drug spending was up 3.3% year over year. Most of the increase was due to higher prices, not increased use of services.
Under private health insurance, spending per person rose 4.5% between 2017 and 2018, even though the same number of people were enrolled.
With such a level of economic increase, people will increasingly face difficulty in obtaining medical care.
While spending is highest, the United States ranks 27th in the world for its levels of health care.