National Health Spending in 2012: Rate of Health Spending Growth Remained Low for the Fourth Straight Year Anne Martin Micah Hartman Lekha Whittle Aaron.
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National Health Spending in 2012: Rate of Health Spending Growth Remained
Low for the Fourth Straight Year
Anne MartinMicah HartmanLekha WhittleAaron Catlin
andThe National Health Expenditure Accounts Team
1
2012 National Health Expenditure Accounts
National health spending increased 3.7 percent in 2012 following 3.6 percent growth in 2011.
National health spending reached $2.8 trillion, or $8,915 per person in 2012.
The share of Gross Domestic Product (GDP) devoted to health care spending fell slightly—from *17.3 percent in 2011 to 17.2 percent in 2012.
*The 2011 health share of GDP was revised due to a large upward revision to GDP
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 2
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
(4.0)
(2.0)
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
12.1 12.8 13.1 13.4 13.3 13.4 13.4 13.3 13.3 13.3 13.4
14.1 14.9
15.4 15.5 15.5 15.6 15.9 16.4
17.4 17.4 17.3 17.2
NHE GDP NHE as a share of GDP
Growth in National Health Expenditures (NHE) and Gross Domestic Product (GDP), and NHE as a Share of GDP, 1990-2012
SOURCES: Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group; Department of Commerce, Bureau of Economic Analysis and National Bureau of Economic Research.
Perc
ent
Calendar Years
December 2007- June 2009 Recession
March 2001-November 2001Recession
July 1990-March 1991Recession
2012 National Health Expenditure Accounts
Overall Mixed Trends
Faster growth in personal health care (PHC) spending
Slower growth in investment and the net cost of private health insurance; decline in non-commercial research
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 4
2012 National Health Expenditure Accounts
Price vs. Non-Price Trends
Price growth accounted for a smaller portion of health spending increase in 2012 compared to 2011.
Non-price factors accounted for a larger portion of health spending increase in 2012 compared to 2011.Population growthAge & gender shiftsOther, such as use & intensity of health care goods and services
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 5
6
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012-0.5%0.0%0.5%1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%5.0%5.5%6.0%6.5%
Factors Accounting for Growth in Per Capita National Health Expenditures and Personal Health Care Expen-
ditures, Calendar Years 2008-2012Other nonprice factors Age and sex factors Medical prices Per capita spending growth
Perc
ent
National health expenditures Personal health care expenditures
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES Medical price growth, which in-cludes economywide and excess medical-specific price growth (or changes in medical-specific prices in excess of economywide inflation), is calculated us-ing the chain-weighted national health expenditures (NHE) deflator for NHE and the chain-weighted personal health care (PHC) deflator for PHC expendi-tures. As a residual, the category of other nonprice factors includes use and intensity and any errors in measuring prices or total spending.
2012 National Health Expenditure Accounts
Trends by Services in 2012
Spending increased at a faster rate:• Hospital care • Physician and clinical services
Spending increased at a slower rate:• Retail prescription drugs• Nursing care facilities
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 7
2012 National Health Expenditure Accounts
Trends by Payers in 2012
Spending increased at a faster rate:• Medicaid• Out-of-pocket spending
Spending increased at a slower rate:• Private health insurance• Medicare
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 8
Affordable Care Act Overall, Affordable Care Act provisions effective for 2010
through 2012 had minimal impact on total national health spending.
Sector-specific provisions: Private health insurance• Pre-existing condition insurance program• Early retiree reinsurance program• Coverage for dependents under age 26• Minimum medical loss ratio
Medicare Program• Reduced payment updates (productivity adjustments)
Retail Prescription Drugs• Medicare drug coverage gap discount program• Medicaid retail prescription drug rebates
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 9
The Nation’s Health Dollar ($2.8 Trillion), Calendar Year 2012: Where It Went
Hospital Care32%
Physicians and Clinics 20%
Prescription Drugs9%
Dental Services and Other Professionals
7%
Government Administra-tion and Net Cost of
Health Insurance7%
Investment16%
Nursing Care Facilities and Continuing Care Retire-
ment Communities5%
Other Health, Residential, and Personal Care3
5%Other Medical Products2
3%
Government Public Health Activities3%
Home Health Care3%
1 Includes Research (2%) and Structures and Equipment (4%).2 Includes Durable (1%) and Non-durable (2%) goods.3 Includes expenditures for residential care facilities, ambulance providers, medical care delivered in non-traditional settings (such as community centers, senior citizens centers, schools, and military field stations), and expenditures for Home and Community-based Waiver programs under Medicaid.Note: Sum of pieces may not equal 100% due to rounding.
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 10
Annual Growth in Spending by Type of Service, 2011 and 2012
Investment
Durable Medical Equipment
Other Non-Durable Medical Products
Prescription Drugs
Nursing Care Facilities And Continuing Care Retirement Communities
Home Health Care
Other Health Residential And Personal Care
Other Professional Services
Dental Services
Physician And Clinical Services
Hospital Care
National Health Expenditures
0.0 1.0 2.0 3.0 4.0 5.0 6.0
1.4
5.6
1.8
0.4
1.6
5.1
4.5
4.5
3.0
4.6
4.9
3.7
5.7
5.6
3.0
2.5
4.3
4.1
3.3
4.6
2.2
4.1
3.5
3.6
2011 2012
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
• Total spending=$882.3 billion• Spending increased 4.9%• Faster growth in 2012 driven by:
– Private Health Insurance– Medicare – Medicaid
Annual Growth in Hospital Spending, 2008 - 2012
32%
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 12
2008 2009 2010 2011 20120.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
5.3
6.6
4.6
3.5
4.9
Annual Growth in Physician and Clinical Services Spending, 2008 - 2012
• Total spending=$565.0 billion• Spending increased 4.6% • Faster growth in 2012 driven by:
– Use & intensity of services – Out-of-pocket spending– Private Health Insurance
20%
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.13
2008 2009 2010 2011 20120.0
1.0
2.0
3.0
4.0
5.0
6.0
5.3
3.43.1
4.1
4.6
Annual Growth in Retail Prescription Drug Spending, 2008- 2012
9%
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.14
• Total spending=$263.3 billion• Spending increased 0.4%• Slower growth in 2012 driven by:
– Slow growth in prices• Patent expirations
– Increased Generic Dispensing Rate
– Decline in out-of-pocket spending
– Decline in Private Health Insurance spending
2008 2009 2010 2011 20120.0
1.0
2.0
3.0
4.0
5.0
6.0
2.8
4.9
0.4
2.5
0.4
The Nation’s Health Dollar ($2.8 trillion), Calendar Year 2012: Where It Came From
Health In-
surance72%
Out-of-pocket212%
Other Third Party
Payers and Pro-
grams18%
Investment6%
Government Public Health Activities
3%
1 Includes worksite health care, other private revenues, Indian Health Service, workers’ compensation, general assistance, maternal and child health, vocational rehabilitation, Substance Abuse and Mental Health Services Administration, school health, and other federal and state local programs.2 Includes co-payments, deductibles, and any amounts not covered by health insurance. Note: Sum of pieces may not equal 100% due to rounding.
VA, DOD, and CHIP (Titles XIX and Title XXI)
4%
Private Health
Insurance33%
Medicare20%
Medicaid (Title XIX) State and Local 7%
Medicaid (Title XIX)
Federal9%
Health Insurance
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.15
Annual Growth in Spending by Source of Funds, 2011 and 2012
Other Third Party Payers and Programs
Department of Defense
Department of Veterans Affairs
CHIP (Title XIX and Title XXI)
Medicaid (Title XIX)
Medicare
Private Health Insurance
Out of pocket
National Health Expenditures
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0
6.8
1.7
3.6
5.3
3.3
4.8
3.2
3.8
3.7
3.7
3.8
6.1
3.8
2.4
5.0
3.4
3.5
3.6
2011 2012
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
Private Health Insurance: Growth in Enrollment, Premiums, and Benefits, 2008 – 2012
2008 2009 2010 2011 2012
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
-0.8%
-3.2%
-1.8%
0.5% 0.4%
3.9%3.1% 3.2% 3.4% 3.2%
4.9%4.3%
2.3%
3.4%3.6%
Total PHI: Growth in Enrollment, Premiums, and Benefits
PHI Enrollment Premiums Benefits
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 17
33%
• Total Spending = $917.0 billion• Spending increased 3.2%• Enrollment reached 188 million• Slightly slower premium growth
in 2012 driven by:– Increased enrollment in
high-deductible plans– Lower growth in the net
cost of insurance
Private Health Insurance: Growth in Per Enrollee, Premiums, and Benefits, 2008 – 2012
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 18
2008 2009 2010 2011 20120%1%2%3%4%5%6%7%8%9%
10%
4.7%
6.5%
5.1%
2.8% 2.7%
5.7%
7.7%
4.2%2.9% 3.2%
Per Enrollee: Growth in Premiums and Benefits
Premiums per enrollee
Benefits per enrollee
• Premium and medical benefit per enrollee trend remained low
• Relatively flat premium per enrollee trend
• Medical benefit spending per enrollee trend:– Slightly faster due to an
acceleration in spending for hospital care and physician and clinical services
– Partially offset by a decline in retail prescription drug spending
33%
Medicare: Growth in Total Expenditures and Enrollment, 2008 – 2012
2008 2009 2010 2011 20120%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2.6% 2.4% 2.5% 2.5%
4.1%
8.1%
6.8%
4.1%
5.0% 4.8%
5.4%
4.3%
1.6% 2.5%
0.7%
Medicare Enrollment Medicare Spending Per enrollee
20%
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 19
• Total Spending = $572.5 billion• Spending increased 4.8%• Slightly slower growth in 2012
was driven primarily by a decline in Nursing Home Care spending
Medicare: Growth in FFS and Medicare Advantage Expenditures and Enrollment, 2008 – 2012
2008 2009 2010 2011 2012
-5%
0%
5%
10%
15%
20%
25%
-0.4%
0.2% 1.5% 1.5%2.1%
4.7% 4.2% 3.9% 4.3%
2.7%
5.1%
4.0% 2.4% 2.7%
0.6%
Fee-for-Service
FFS Enrollment FFS SpendingPer FFS enrollee
2008 2009 2010 2011 2012
-5%
0%
5%
10%
15%
20%
25%
15.0%
10.5%
5.6% 5.4%
10.0%
21.1%
15.7%
4.6%
7.0%
10.9%
5.3% 4.7%
-1.0%
1.6% 0.8%
Medicare Advantage
MA Enrollment MA Spending Per MA enrollee
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 20
20%
Medicaid: Growth in Total Expenditures and Enrollment, 2008 – 2012
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
15%
21
2008 2009 2010 2011 2012-2%
0%
2%
4%
6%
8%
10%
3.5%
7.3%
4.9%
3.2%
1.9%
5.8%
8.8%
6.1%
2.4%3.3%
2.2%1.4% 1.1%
-0.7%1.3%
Total Medicaid Expenditures and Enrollment
Enrollment Spending Per enrollee
• Total Spending = $421.2 billion• Spending increased 3.3%• Slightly faster growth in 2012
driven by increased spending growth for: – Hospital care– Other health, residential, and
personal care• Spending growth in 2011 and
2012 historically low (excluding 2006) due to:– Slowdown in enrollment
growth– States efforts to control costs
Medicaid: Growth in Total, Federal, and State & Local Expenditures,
2008 – 2012
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 22
2008 2009 2010 2011 2012
5.8%8.8%
6.1%
2.4% 3.3%
9.6%
21.9%
7.8%
-7.2%-4.2%
0.7%
-10.0%
2.7%
22.0%
15.0%
Federal and State & Local Med-icaid Expenditures
Total Federal State/local
15%
Distribution and Annual Growth by Type of Sponsor
2010 2011 20120%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20% 21% 21%
28% 28% 28%
7% 7% 7%
28% 27% 26%
16% 17% 18%
Distribution of National Health Expenditures by Type Of Sponsor,
2010 - 2012
State and local government
Federal gov-ernment
Other Private Revenues
Households
Private Business
2008 2009 2010 2011 2012
-5%
0%
5%
10%
15%
20%
Annual Growth in Spending by Sponsor, 2008 - 2012
State and Local GovernmentFederal GovernmentPrivate BusinessHouseholds
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 23
Note: Sum of pieces may not equal 100% due to rounding.
2012 National Health Expenditure Accounts:Summary
National Health Expenditures increased 3.7 percent in 2012. National Health Expenditures reached $2.8 trillion, or $8,915 per person in 2012. National Health Expenditures represented a 17.2 percent share of Gross Domestic
Product (GDP). Spending grew faster in 2012 for:
• Hospitals • Physician and clinical services • Medicaid • Out-of-pocket
Spending grew at a slower rate in 2012 for:• Prescription drugs • Nursing care facilities • Private health insurance • Medicare
Sponsor• Shares have remained stable except for the end of the temporary shift from
federal to state and localSOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. 24
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