ANN ARBOR, MI—National health spending in August 2015 was 5.7% higher than in August 2014. While spending growth in 2015 has exceeded the historically low 4% levels experienced in 2009 through 2013, there has been a gradual decline in the growth rate since the February 2015 high of 6.8%. Prescription drug spending grew the fastest of the major categories at 9.2% year over year, though down from its multi-year high of 14.6% in December 2014.
Health care prices in August 2015 were 1.2% higher than in August 2014, breaking a string of 1.1% readings. Even with this slight acceleration, prices are growing only two tenths above the decade-plus low of 1.0% growth registered in August 2013. Year-over-year hospital prices rose 1.0% in August, the highest since September 2014, though quite low in historical context. Physician and clinical services prices fell 1.0% and have been near -1% for 8 straight months. Prescription drug prices rose 4.7%, the first uptick in price growth in 2015.
The health sector added a strong 34,400 new jobs in September, with minimal revisions to July and August. Hospitals continued robust hiring, adding 15,500 jobs in August, and have added 124,000 jobs so far in 2015, 54,000 in the third quarter alone. The health share of total employment increased each month in 2015, reaching 10.69% in September, a new all-time high. Health jobs grew 3.2% year over year, while nonhealth job growth dipped from a post-recession peak of 2.3% at the beginning of 2015 to 1.8% in September.
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).
“We have previously noted the spending growth acceleration and large health-sector employment gains associated with expansion of health insurance coverage, stronger economic growth, and special factors such as new hepatitis C drugs,” said Ani Turner, deputy director of the Center. “We are seeing some evidence that these impacts are declining as 2015 progresses, but whether health spending growth continues to moderate or the historic slowdown is over will depend on how these potentially temporary drivers continue to play out, and the degree to which the Affordable Care Act and private-sector forces continue to exert cost containment pressure to drive lasting structural change.”
Please see our September Health Sector Trend Report for additional details based on the September 9, 2015, release of the Quarterly Services Survey.