(Bloomberg) — U.S. health care spending jumped 5.3 percent last year, the biggest increase since President Barack Obama took office, as millions of people gained insurance coverage under the Patient Protection and Affordable Care Act (PPACA).
Spending on hospitals, doctors, drugs and other health care expenses hit $3 trillion in 2014, or 17.5 percent of the economy, according to a study released Wednesday by government actuaries. Enrollment in private health plans increased by 2.2 million people to 189.9 million, while 7.7 million more people were covered by Medicaid, bringing the total to 65.9 million.
The U.S. had seen years of slow health care cost growth after the economic downturn that ended in 2009. The 2.9 percent rise in 2013 was the slowest in the 55 years that the U.S. has studied the figure. Actuaries at the Centers for Medicare and Medicaid Services (CMS), estimated in July that spending will rise an average of 5.8 percent a year over the decade through 2024.
“Today’s report reminds us that we must remain vigilant in focusing on delivering better health care outcomes, which leads to smarter spending, particularly as costs increase in key care areas, like prescription drugs,” CMS Acting Administrator Andy Slavitt said in a statement.
Spending on retail prescription drugs was among the fastest-growing categories, rising 12.2 percent, as new treatments for hepatitis C and some cancers were introduced, according to the report. Drug spending accounted for $297.7 billion, just under 10 percent of the total.