By 2017, U.S. healthcare spending is expected to nearly double from 2007’s projected level, reaching $4.3 trillion and consuming 19.5 percent of the nation’s gross domestic product (GDP), report Centers for Medicare and Medicaid Services (CMS) analysts in today’s web exclusive edition of Health Affairs. The 10-year estimates follow last month’s report from the government that health spending in 2006 surpassed $2.1 trillion for the first time, accounting for 16.0 percent of GDP.
Healthcare spending is expected to hit $2.2 trillion in 2007, growing on average 6.7 percent through 2017 and outpacing economic growth by about 1.9 percentage points each year. Steady health spending growth coupled with what analysts project to be somewhat lower economic growth of about 4.7 percent annually is expected to result in a gradual increase in health spending as a share of GDP.
Although the outlook for national health spending growth calls for continued stability for the next 10 years, the authors note that they expect the leading edge of the baby-boom generation to begin to affect the Medicare program. By 2017, Medicare spending is expected to account for $884 billion, or just over one-fifth of all national health spending. Medicaid spending also is expected to continue to rise at a faster rate than overall health spending during the coming decade. Medicaid expenditures are projected to grow 8.9 percent in 2007 to $338.2 billion. Read the abstract.
