Policy Watch

Hospitals’ Medicare price increases also have drawn attention in recent months while reaching the highest point in a decade.


May 17—Congress is set to examine hiring challenges in the healthcare industry next week, as the sector hits an all-time high share of total U.S. employment.

The Senate Health, Education, Labor and Pensions (HELP) Committee scheduled a May 22 hearing on healthcare hiring challenges.

In April 2018, the healthcare sector added 24,400 new jobs, according to the latest tally by the Bureau of Labor Statistics.

That was consistent with the 12-month average of 25,500 new jobs per month, and enough to propel the industry’s share of total U.S. jobs to 10.76 percent—the highest ever—according to a recent Altarum analysis.

Hospitals added 8,000 jobs in April, while ambulatory settings added 16,900 positions. Revisions to February and March figures also added about 6,000 jobs in those settings.

The 0.16 percent increase in hospital employment in April brought the seasonally adjusted total to 5.1 million. The total represents a 94,500 increase over the last year.

Without the seasonal adjustment, which removes the effect of fluctuations due to seasonal events, hospital employment fell by 400 in April.

Hospital hiring growth has been steady since early 2017, Altarum noted, while the healthcare sector’s share of jobs continues an upward trend and mirrors the growth in the share of GDP that is taken up by healthcare spending.

Year-over-year healthcare spending growth increased from 4.1 percent in May 2017 to 5.2 percent in March 2018, according to Altarum. Quarterly spending growth has accelerated from 4.2 percent in the second quarter of 2017 to 5 percent in the first quarter of 2018.

“This modest acceleration has occurred in spite of declines in [health insurance] coverage that now extend into 2018,” Altarum noted.

Altarum noted that hospitals have led the spending acceleration. In contrast, prescription drug spending slowed to an annual growth rate of 3.4 percent, which is the lowest since December 2016.

“It is concerning to see the growth rate in health spending move above 5 percent in the first quarter of 2018,” said Charles Roehrig, MD, a fellow at Altarum. “While this is only a mild acceleration from the 4.6 percent growth in 2017, it comes even as healthcare coverage has declined. It also keeps health spending growth well above the 4.6 percent growth in GDP.”

Prices and Spending

On a related note, Altarum reported that in April 2018 the Health Care Price Index rose by 2.2 percent compared to the previous year—the highest rate since January 2012. The rate was fractionally higher than in March, and the driver was once again high hospital price growth—especially for Medicare, where price growth of 4.6 percent was the highest since November 2009. Private-sector hospital price growth of 3.8 percent was the highest rate since the private-only data series was created in June 2014.

Year-over-year overall hospital price growth fell slightly to 3.6 percent, from 3.7 percent in March.

Healthcare price growth overall increased to more than 2 percent in recent months but remained roughly in line with an economy-wide 2 percent inflation rate.

Seasonally adjusted annual national healthcare spending of $3.62 trillion for March 2018 was 5.2 percent higher than it was in March 2017. Spending in March 2018, year over year, increased in all major categories, led by nursing home spending at 8.6 percent. Growth in spending on prescription drugs (3.4 percent) was the slowest.

Tuesday, May 22

Conference call by the Centers for Medicare & Medicaid Services on the Medicare claims settlement conference facilitation expansion. Learn more.

Webinar by the Substance Abuse and Mental Health Services Administration (SAMHSA) titled “The Power of Perceptions and Understanding: Changing How We Deliver Treatment and Recovery Services.” Learn more.

Webinar by the American Hospital Association titled “Positioning Your Diversity Strategy for Organizational Impact.” Learn more.

Wednesday, May 23

Vote by the Senate HELP Committee on the Pandemic and All-Hazards Preparedness and Advancing Innovation Act of 2018. Learn more.

Hearing by the House Energy and Commerce Committee’s Health Subcommittee titled “Reauthorization of the Children’s Hospital Graduate Medical Education Program.” Learn more.

Webinar by the Centers for Disease Control and Prevention titled “The Intersection of Public Health and Healthcare: Emerging Trend in Health System Transformation and the Law, Part I.” Learn more.

Webinar by SAMHSA titled “Social Media/Technology for Outreach and Engagement.” Learn more.

Webinar by the Interprofessional Education Collaborative (IPEC) titled “Promoting Health & Wellness Through Collaboration.” Learn more.

Thursday, May 24

Senate Finance Committee hearing titled “Rural Health Care in America: Challenges and Opportunities.” Learn more.

Summit by the Alliance for Health Policy titled “Health Care Costs in America.” Learn more.


Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Thursday, May 17, 2018