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3 new facts about private U.S. health spending

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U.S. health spending accounted for $2.9 trillion in U.S. spending in 2013, or 17.4 percent U.S. gross domestic product (GDP).

National health expenditure (NHE) grew a total of 3 percent between 2012 and 2013, and 2.9 percent per person.

The total share of GDP going to health care held steady.

Micah Hartman and other analysts at the Office of the Actuary at the Centers for Medicare & Medicaid Services (CMS) published the NHE data in a report in Health Affairs, an academic journal that focuses on health care delivery and health finance.

See also: Forecasters see 13 percent health insurance spending jump

Private business spending on health care increased 4 percent, to $611 billion. The rate of increase slowed from 4.8 percent in 2012.

Households increased their health spending 2.8 percent, to $824 billion. The growth rate of household health spending was down from 4.8 percent.

The federal government’s share of health spending held steady at 26 percent. State and local governments’ share fell to 17 percent, from 18 percent.

For more NHE report highlights, read on.


1. Spending on private health insurance premiums increased 2.8 percent, to $962 billion.

Spending on Medicare grew 3.4 percent, to $586 billion, and spending on Medicaid grew 6.1 percent, to $449 billion.

For private insurance, the growth rate was down from 4 percent in 2012.

That year, by coincidence, Medicare spending and Medicaid spending also had a 4 percent growth rate.

Because health insurers were effective at holding health care spending down in 2013, the “net cost of insurance” — the difference between premiums earned and benefits paid — actually grew 5 percent, to about $174 billion.

See also: CMS Actuaries: Private Health Insurance Spending to Keep Growing

2. Spending on government health care administration efforts jumped 8.2 percent, to $37 billion.

You thought setting up a glitch-plagued health insurance enrollment — and advertising it comprehensively through radio, television, print, outdoor, Web and social media channels — was cheap?


See also: PPACA exchange open enrollment update.


3. Spending on noncommercial medical research — the efforts to find new ways to prevent health problems, and to reduce the devastation caused by the problems people do have — fell 2.6 percent, to $46.7 billion.

The percentage of health care spending going into noncommercial scientific studies of ways to tackle health care problems fell to 1.6 percent in 2013, from 1.8 percent in 2007.

See also: Forecasters see 13 percent health insurance spending jump