CMS: U.S. health spending projected to grow 5.5 percent annually over decade

National health expenditures are projected to grow an average 5.5 percent annually during 2018-2027, outpacing average projected growth in gross domestic product by 0.8 percentage point, the Centers for Medicare & Medicaid Services’ Office of the Actuary reported today. While the insured population is expected to remain around 90 percent throughout the period, average annual Medicare spending (7.4 percent) is expected to exceed that in Medicaid (5.5 percent) and private health insurance (4.8 percent) as baby-boomers continue to age into the program, the agency said. Prices for health care goods and services are projected to grow an average 2.5 percent per year. Spending for hospital services and for physician and clinical services are expected to grow an average 5.6 percent and 5.4 percent, respectively, per year, which includes the cost of prescription drugs administered in those settings. Spending for retail prescription drugs is expected to grow an average 5.6 percent per year. Population growth and the changing age-sex mix of the population account for over two thirds of the projected spending growth.