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U.S. health spending to hit $6 trillion by 2027- CMS


U.S. health spending to hit $6 trillion by 2027- CMS

Rising income levels, better employment rate and more people enrolling for Medicare, the federal health insurance program for people aged 65 and above and the disabled, will cause healthcare spending to rise to 19.4 per cent of the U.S. economy by 2027, the Centers for Medicare & Medicaid Services (CMS) said.

U.S: U.S. health spending is expected to grow at an average rate of 5.5 per cent every year from 2018 over the next decade and will reach nearly $6 trillion by 2027 as more people become eligible for Medicare, a government health agency said on Wednesday.

Rising income levels, better employment rate and more people enrolling for Medicare, the federal health insurance program for people aged 65 and above and the disabled, will cause healthcare spending to rise to 19.4 per cent of the U.S. economy by 2027, the Centers for Medicare & Medicaid Services (CMS) said.

In 2017, healthcare spending accounted for 17.9 per cent of the country’s gross domestic product.

Annual spending growth for Medicare is expected to average 7.4 per cent over the 10-year period, CMS said.

That number exceeds spending projections for Medicaid — the government insurance program for low-income Americans — and private health insurance plans, which are expected to average 5.5 per cent and 4.8 per cent respectively, over the same period.

The CMS said it expects Medicare enrollment growth to peak at 2.9 per cent in 2019.

Prescription drug spending is also expected to rise and average 5.6 per cent annually between 2018 and 2027 as employers and insurers push patients with chronic conditions to adhere to medications better, and as new and expensive drugs enter the market.

Hospital spending growth is projected to an average of 5.6 per cent per year between 2018 and 2027.

By 2027, federal, state and local governments are expected to fund 47 per cent of national health spending, compared with 45 per cent in 2017, according to the report.

The CMS said that all projections are reflective of current laws and do not take into account policy changes under consideration.

Also Read: US to boost drug price negotiation in Medicare Advantage health plans


Source: Reuters
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