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March 02, 2008 at 07:00 PM
Prescription drug prices will continue to moderate, but growth there and in an “other private health care” category will contribute to another decade of skyrocketing U.S. health expenditures.
Economists and actuaries in the Office of the Actuary at the Centers for Medicare and Medicaid Services are making that prediction in a paper published in the Web edition of Health Affairs, a scientific journal that focuses on the delivery and financing of health care.
The research team, led by Sean Keehan, an economist at the CMS national health statistics group, is estimating that overall national health expenditures will increase an average of 6.7% from 2007 to 2017, compared with an average annual increase of 4.7% in U.S. gross domestic product.
The increase, which will amount to 5.8% per year per capita, will push total national health expenditures to $4.3 trillion, or 19.5% of GDP, in 2017, up from $2.2 trillion, or 16.3% of GDP, in 2007, the researchers estimate.
The researchers include a figure for “program administration and net cost of private health insurance”–health insurance premiums minus expenditures on medical claims. Spending in that category will increase about 6.7% per year, the researchers estimate. That category will account for about $298 billion in expenditures, or 7% of national health expenditures, in 2017, up from 6.9% in 2007, the researchers predict.
Average private health insurance payments probably rose 6.4% in 2007, up from 5.5% in 2006, the researchers write.
“A mild cycle of premium growth is expected over the projection period, with acceleration to 6.9% in 2009 followed by a gradual slowdown to 5.9% by 2017,” the researchers write.
