Health care spending per privately insured American increased 7.4 percent in 2003

Health care spending per privately insured American increased 7.4 percent in 2003—the first major slowdown in spending growth in nearly a decade. Nonetheless, health spending grew nearly twice as fast as the overall economy in 2003 (see Table 1).

While still extremely high, the rate of health spending growth slowed for the second year in a row in 2003, down from 9.5 percent in 2002 and 10 percent in 2001. Trends in all four spending categories—inpatient and outpatient hospital care, prescription drugs, and physician services—continued to slow in 2003. Moreover, the decline in spending growth appeared to slow growth in employersponsored health insurance premiums to an average 12 percent in 2004, marking the first downtick in premium growth since 1996.

TABLE 1: Annual Change Per Capita in Health Care Spending and Gross Domestic Product, 1994-2003
 
Spending on Type of Health Care Service
 
Year
All Services
Hospital Inpatient
Hospital Outpatient
Physician
Prescription Drugs
Gross Domestic
Product (GDP)
1994
2.1%
-2.0%
8.7%
1.7%
5.2%
4.9%
1995
2.2
-3.5
7.9
1.9
10.6
3.4
1996
2.0
-4.4
7.7
1.6
11.0
4.4
1997
3.3
-5.3
9.5
3.4
11.5
5.0
1998
5.3
-0.2
7.5
4.7
14.1
4.1
1999
7.1
1.6
10.2
5.0
18.4
4.8
2000
7.8
4.1
9.8
6.3
14.5
4.8
2001
10.0
8.7
14.6
6.7
13.8
1.8
2002
9.5
8.4
12.9
6.5
13.2
2.7
2003
7.4
6.5
11.0
5.1
9.1
3.8

Notes: GDP is in nominal dollars. Estimates may differ from past reports due to data revisions by Milliman USA and the Bureau of Economic Analysis.

Sources: Health care spending data are the Milliman USA Health Cost Index ($0 deductible); GDP is from the U.S. Department of Commerce, Bureau of Economic Analysis

Full article at http://www.hschange.com

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