Healthcare Costs to Rise 6 Percent a Year

BALTIMORE, Sept. 9 (UPI) — U.S. healthcare spending is projected to reach nearly $4.6 trillion by 2019, growing at an average annual rate of 6.3 percent, U.S. government officials say.

Economists at the Centers for Medicare and Medicaid Services estimate that by 2019, healthcare is projected to account for 19.6 percent of the gross domestic product — 0.3 percentage points higher than anticipated before healthcare reform.


In 2010, healthcare spending is projected to reach $2.6 trillion and account for 17.5 percent of GDP, up 0.2 percentage point from pre-reform estimates. The increase is driven by the postponement of cuts to Medicare physician payments and legislative changes to COBRA premium subsidies for the unemployed, the economists say.

“In the aggregate, it appears that the Affordable Care Act will have a moderate effect on health spending growth rates and the healthcare care share of the economy,” lead author Andrea Sisko, an economist at CMS, says in a statement.

In 2011, public and private health spending is expected to grow more slowly as reductions in Medicare physician payment rates are implemented and COBRA premium subsidies expire.

Health spending is estimated to increase in 2014 when health insurance coverage is expanded to the uninsured Americans, and expected to increase by 9.2 percent, but out-of-pocket spending by consumers is projected to decline by 1.1 percent instead of rising 6.4 percent as initially expected, the study says.

The findings are published in the journal Health Affairs.

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