CSHS Health Sector Economic Indicators Briefs

Altarum’s Health Sector Economic IndicatorsSM briefs are designed to address significant shortcomings in the availability of timely economic data on the health sector, including employment, spending, and prices. Published monthly, the reports are a product of Altarum's Center for Sustainable Health Spending.

 

July 2015 Health Sector Economic IndicatorsSM Briefs

The health sector continued its strong job growth in June with the addition of 40,100 new jobs. Health job growth doubled between 2013 and 2014 (13,000 versus 26,000 jobs per month) and is nearly three times as high in the first half of 2015 (38,000 per month) than it was in 2013. National health spending in May 2015 was 5.9% higher than in May 2014, moderating from a more-than-8-year peak growth rate of 6.8% in March 2015. Health care prices in May 2015 were 1.1% higher than in May 2014, only a tenth above the decade-plus low of 1.0% growth registered in August 2013.

 

National health spending in April 2015 was 6.2% higher than in April 2014. At $3.2 trillion, health spending now represents 18.2% of gross domestic product, a new all-time high. The health sector added 46,800 new jobs in May, and has added more than 400,000 jobs in the past 12 months, growth not seen since 1991. Health care prices in April 2015 were 1.2% higher than in April 2014, only two-tenths higher than the decade-plus low of 1.0% growth registered in August 2013. Hospital prices rose by a low 0.5%.

 

May 2015 Health Sector Economic IndicatorsSM Briefs

The health services sector added 45,000 jobs in April 2015, continuing the surge that began roughly 1 year ago. On a year-over-year basis, health job growth now comfortably exceeds nonhealth growth at 2.7 percent versus 2.1 percent. Health care prices in March 2015 were 1.3 percent higher than in March 2014, but hospital prices rose a scant 0.4 percent, while physician and clinical services prices actually fell 0.6 percent. Prescription drug prices rose 5.7 percent, the second highest reading since February 2002. And preliminary estimates show that national health spending in March 2015 was 6.8 percent higher than in March 2014. At $3.2 trillion, health spending now represents 18.1 percent of gross domestic product, the first time ever this share has breached the 18 percent level

 

April 2015 Health Sector Economic IndicatorsSM Briefs

National health spending grew by 5.2% in 2014, and preliminary estimates show 6.6% growth in February 2015 compared to February 2014. Health care prices in February 2015 were 1.4% higher than in February 2014, barely above the January year-over-year change of 1.2%. The February 2015 12-month moving average held at 1.5%. And the health sector added 22,000 jobs in March 2015, close to the 24-month average but below the 12-month average gain of about 30,000. Hospitals added 8,000 jobs in March and are averaging 10,000 new jobs per month in the first quarter of 2015.

 

March 2015 Health Sector Economic IndicatorsSM Briefs

Preliminary estimates indicate that national health spending grew by 5.7% in January 2015 compared with January 2014, suggesting that the strong growth in the latter half of 2014 is carrying forward into the new year. Spending on prescription drugs continued its double-digit growth at 11.6%. Health care prices in January 2015 were 1.2% higher than in January 2014, dramatically lower than the December year-over-year change of 1.8%. And the health sector added 23,800 new jobs in February 2015, below the average growth seen in the fourth quarter of 2014 (39,000) and the January 2015 level (40,000).

 

February 2015 Health Sector Economic IndicatorsSM Briefs

Health sector employment began 2015 much as it left off in 2014, adding 38,300 new jobs in January 2015, consistent with the 39,000 new jobs per month seen in the fourth quarter of 2014. Over the past 3 months, the health sector has added 127,000 jobs, the largest quarterly increase since January 1990 (which is as far back as our data go). Health care prices in December 2014 were 1.8% higher than in December 2013, two-tenths of a percentage point above the November rate. Prescription drug prices rose 6.4%, a growth rate not seen since 1992, well up from 4.6% in November. Preliminary estimates indicate that national health spending grew by 5.0% in 2014 and by 5.6% in December 2014 compared with December 2013, up significantly from the official 2013 national spending growth rate of 3.6%—the all-time low.

 

January 2015 Health Sector Economic IndicatorsSM Briefs

Health sector employment ended 2014 with a bang as it added 34,100 new jobs in December 2014 and saw upward revisions of 17,800 in October and November. Health care prices in November 2014 were 1.6 percent higher than in November 2013, a 10th higher than the October year-over-year rate. And national health spending in November 2014 grew 5.1 percent over November 2013. Incorporating the Quarterly Services Survey, released on December 10, we now estimate that national health spending in the third quarter was 5.5 percent greater than in the third quarter of 2013—the highest growth rate since the first quarter of 2008, when it was 5.8 percent.

 

December 2014 Health Sector Economic IndicatorsSM Briefs

The Quarterly Services Survey showed 5.4% growth in spending on health care services in the third quarter of 2014 (July – September) compared with the same quarter in 2013. For jobs, the acceleration in health sector employment continued, with 28,900 new jobs in November 2014, plus upward revisions totaling 5,000 for the two previous months. And for prices, health care prices in October 2014 were 1.5% higher than in October 2013, two-tenths below the September year-over-year reading.

 

November 2014 Health Sector Economic IndicatorsSM Briefs

Health care gained a solid 24,500 jobs in October 2014, similar to the 26,000 average from the previous two quarters, and well above the 17,500 average for the 12 months ending in March 2014. Prices in September 2014 were 1.7% higher than in September 2013, equal to the August year-over-year reading. And national health spending in September 2014 grew 4.7% over September 2013; the preliminary health spending share of GDP was 17.4% in September, up from 16.0% at the start of the recession in December 2007. 

 

October 2014 Health Sector Economic IndicatorsSM Briefs (Labor and Spending Only)

Health care added 22,600 jobs in September. Combined with very strong August growth and upward revisions to July, the 6-month average job gain now sits at 26,000, about 50% higher than the 17,500 average over the previous 12 months ending in March 2014. Solid continued growth seems likely, as the August job openings rate of 4.3% in health care and social assistance is the highest since before the recession. Health spending in August 2014 grew 4.9% over August 2013, while second-quarter growth, reflecting data from the September Quarterly Services Survey, came in at 5.1%.

 

September 2014 Health Sector Economic IndicatorsSM Briefs

Health spending in July 2014 grew 4.3% over July 2013, bringing the year-to-date increase to 4.4%. This is well above the 3.6% growth rate estimated for 2013 by the Centers for Medicare and Medicaid Services and, with further acceleration expected in the final two quarters, puts 2014 on track to be the first year since 2008 in which growth has exceeded 4%.  Health care gained a strong 34,000 jobs in August, and revisions to June and July showed a net increase of 15,500 jobs. And health care prices in August 2014 were 1.7% higher than in August 2013, similar to the rates reported for April through June, but roughly half a percentage point higher than for the first quarter of 2014.  

 

August 2014 Health Sector Economic IndicatorsSM Briefs

Health care gained a modest 7,000 jobs in July, bringing the 2014 year-to-date monthly average down to 18,000, very close to the monthly average for all of 2013. Health care prices in June 2014 were 1.7% higher than in June 2013, but similar to the rates reported for April and May, and 0.6% higher than for the first quarter of 2014. Health spending in June 2014 grew 4.8% over June 2013, a significant increase over the 4.2% growth estimated for calendar year 2013. 

 

July 2014 Health Sector Economic IndicatorsSM Briefs (Price and Labor Only)

Health care prices in May 2014 were 1.8% higher than in May 2013, well above the 12-month moving average of 1.3%. Hospital prices grew 2.1% while prescription drug prices rose 3.6%.  Physician and clinical services prices, which exhibited near-zero growth in the first quarter of 2014, grew by 0.6%. Health care gained 21,000 jobs in June 2014. Over the first half of 2014, the health sector grew by over 20,000 jobs per month, about 20 percent higher than in the first half of 2013. 

 

June 2014 Health Sector Economic IndicatorsSM Briefs (Spending Only)

In May 2014, health spending increased to a seasonally adjusted annual rate (SAAR) of $3.02 trillion, from its value of $3.01 trillion in April. April’s health spending accounted for 17.5% of GDP – equal to its March value (May GDP data are not yet available). As a share of PGDP, April’s spending was at 16.7% – again equal to the March value. Year over year, health spending in May grew by 4.8% – higher than its April value of 4.6% .

 

June 2014 Health Sector Economic IndicatorsSM Briefs (Price and Labor Only)

Health care prices in April 2014 were 1.6% higher than in April 2013, well above the March rate of 1.1%. Year over year, hospital prices – a key price index driver – grew 2.1% in April, above the March rate of 1.3%. Physician and clinical services prices grew 0.6%; and home health care prices rebounded from a year-long negative growth trend, recording a 0.4% rate in April. Prescription drug prices rose 2.4% and are growing at an annual rate of 7% over the past quarter. Health care gained 34,000 jobs in May 2014, over twice the average of 16,000 seen across the first four months of 2014.

 

May 2014 Health Sector Economic IndicatorsSM Briefs

National health spending (NHS) in March 2014 grew 7.1% over March 2013, the highest 12-month rate since February 2005, well before the recession, which began in December 2007. The health spending share of GDP reached an all-time high of 17.9% in March, just above its February value of 17.8%.

 

April 2014 Health Sector Economic IndicatorsSM Briefs

National Health Expenditures (NHE) in February 2014 grew 6.7% over February 2013, the highest rate since March 2007, just prior to the recession, which officially began in December 2007. While governmental data attribute a portion of the growth in January and February 2014 to newly insured individuals under the Affordable Care Act, much of the acceleration in growth occurred during 2013, prior to ACA’s expanded coverage. Growth during the first quarter of 2013 was less than 4% but, by the fourth quarter, it had risen to 5.3%. The health spending share of GDP reached an all-time high of 17.7% in January, the most recent month for which GDP data are available.

 

March 2014 Health Sector Economic IndicatorsSM Briefs

The growth in health care jobs remained low in February 2014, with a gain of only 9,500 jobs, the third straight month of meager growth, resulting in the lowest three-month gain (17,700) on record.  Hospitals, the largest health sector employer, shed 10,000 jobs over this three-month period. Meanwhile, health spending growth has been trending upward, moving above 4% in the latter half of 2013 and, then, with the initial influx of newly insured, to 5.4% in January 2014 (relative to January 2013). 

 

February 2014 Health Sector Economic IndicatorsSM Briefs (Labor and Spending)

Health care lost 400 jobs in January 2014, and revised data for December 2013 showed a scant gain of 2,400 jobs. This two-month increase of 2,000 jobs is the lowest since our data series began in 1989, and the 3-month moving average gain of 10,500 jobs has not been lower in more than a decade.

 

January 2014 Health Sector Economic IndicatorsSM Briefs

National health expenditures for the first 11 months of 2013 were 4.0% above the same period in 2012. While trending up since April – preliminary spending data for November 2013 showed year over year growth of 4.5% – expenditure growth remains near the revised all-time low rate of 3.6% for 2011. Depending on the December data, 2013 could be the fifth consecutive year of health spending growth below 4%, a rate that had not been seen before in the 50-plus years of national health expenditure accounting.

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