ANN ARBOR, Mich.--(BUSINESS WIRE)--National health spending in June 2016 was 5.2% higher than in June 2015, totaling $3.36 trillion (seasonally adjusted annual rate). For the first 6 months of 2016, health spending grew at a rate of 5.3%, slightly below the 2015 estimate of 5.5% made by the Centers for Medicare and Medicaid Services (CMS), but modestly above the 4.8% rate that CMS projects for all of 2016. The health spending share of gross domestic product (GDP) stood at 18.2% in June, tied for the all-time high in our series, first hit in February 2016.
Health care prices in June 2016 were 1.6% higher than in June 2015, the highest rate since December 2014. The June 12-month moving average was 1.3%, the highest level since July 2015. While still very low, these rates are clearly trending upward. Year-over-year hospital price growth was steady at a 1.0% rate in June, as was physician and clinical services prices, at a scant 0.3% rate in June. Drug price growth spurted to 4.4%, the highest rate since August 2015.
Health care added 43,200 new jobs in July, above the 12-month average of 39,700 new jobs per month. Strong growth in hospital hiring put the July figure of 17,100 above the 12-month average of 15,300. Continuing the recent pattern, health jobs grew 3.2% year over year while non-health jobs grew 1.6%. The health share of total employment held at the all-time high of 10.78%.
These data come from the monthly Health Sector Economic IndicatorsSM briefs released by Altarum Institute’s Center for Sustainable Health Spending (http://www.altarum.org/healthindicators).
“Health spending growth has shown the expected slowing since the bump associated with Affordable Care Act expanded coverage, and could drop below 5% during the second half of 2016,” said Charles Roehrig, founding director of the Center. “This would be consistent with the latest CMS 11-year projections showing 4.8% growth for 2016. In my new Health Affairs Blog, I discuss these projections and argue that, although they are moderate relative to historical levels, they are still unaffordable in the long term.”
The full video from our July 12, 2016 Symposium, Sustainable U.S. Health Spending in the Next Administration, is now available here. It features Ceci Connolly, Douglas Holtz-Eakin, Jeff Goldsmith, Joe Antos, Gene Steuerle, Amitabh Chandra, Zeke Emanuel, Kate Baicker, and others.
Altarum Institute (www.altarum.org) integrates objective research and client-centered consulting skills to deliver comprehensive, systems-based solutions that improve health and health care. Altarum employs almost 400 individuals and is headquartered in Ann Arbor, Michigan, with additional offices in the Washington, D.C., area; Portland, Maine; and San Antonio, Texas.