HC Statistics

Health care to comprise 20% of the US economy by 2025

That is the conclusion reacted by CMS’ Office of the Actuary.  As published in a recent Health Affairs article:

Under current law, national health expenditures are projected to grow at an average annual rate of 5.6 percent for 2016–25 and represent 19.9 percent of gross domestic product by 2025. For 2016, national health expenditure growth is anticipated to have slowed 1.1 percentage points to 4.8 percent, as a result of slower Medicaid and prescription drug spending growth. For the rest of the projection period, faster projected growth in medical prices is partly offset by slower projected growth in the use and intensity of medical goods and services, relative to that observed in 2014–16 associated with the Affordable Care Act coverage expansions. The insured share of the population is projected to increase from 90.9 percent in 2015 to 91.5 percent by 2025.

Take notice, however, that these projects are based on “current law”. Current law means that these are projections assuming no changes to any laws. Clearly with a new President in office who has called for “Repeal and Replace” the likelihood of no change is unlikely. Nevertheless, have a “current law” projection is useful so that policymakers can evaluate how any changes to current law could affect long-run health spending in the U.S.


Leave a Reply

Your email address will not be published. Required fields are marked *