National Health Expenditure Projections 2017-2026 – CMS

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The health share of GDP is expected to rise from 17.9 percent in 2016 to 19.7 percent by 2026. … per year) and Medicaid (5.8 percent per year) are both substantial contributors to the rate of national health expenditure growth for the projection period.

Gross Domestic Product (GDP) per year over the 2017-26 period; as a result, the health share of GDP is expected to rise from 17.9 percent in 2016 to 19.7 percent by 2026. … per year) and Medicaid (5.8 percent per year) are both substantial contributors to the rate of national health expenditure growth for the projection period.

National Health Expenditure Projections 2017-2026
Forecast Summary
Major Findings for National Health Expenditures: 2017-2026

(From Centers for Medicare and Medicaid Service actuaries. Website: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/ForecastSummary.pdf, accessed February 12, 2019.)

  • Under current law, national health spending is projected to grow at an average rate of 5.5
    percent per year for 2017-26 and to reach $5.7 trillion by 2026. While this projected
    average annual growth rate is more modest than that of 7.3 percent observed over the
    longer-term history prior to the recession (1990-2007), it is more rapid than has been
    experienced from 2008-16 (4.2 percent).
  • Health spending is projected to grow 1.0 percentage point faster than the Gross Domestic
    Product (GDP) per year over the 2017-26 period; as a result, the health share of GDP is
    expected to rise from 17.9 percent in 2016 to 19.7 percent by 2026.
  • Projected national health spending and enrollment growth over the next decade is largely
    driven by fundamental economic and demographic factors: changes in projected income
    growth, increases in prices for medical goods and services, and enrollment shifts from
    private health insurance to Medicare related to the aging of the population.
  • Among the major payers for healthcare, growth in spending for Medicare (7.4 percent
    per year) and Medicaid (5.8 percent per year) are both substantial contributors to the rate
    of national health expenditure growth for the projection period. Both trends reflect the
    impact of an aging population.
  • The recent enactment of tax legislation that eliminated the individual mandate is expected
    to lead to a reduction in the insured rates. Economic factors, such as projected GDP
    growth and employment trends, are the primary factors contributing to a slight projected
    decline in the insured share of the population from 91.1 percent in 2016 to 89.3 percent in
    2026.
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