October 2026 Health Sector Economic Indicators Briefs

Altarum's monthly Health Sector Economic Indicators (HSEI) briefs analyze the most recent data available on health sector spending, prices, employment, and utilization. Below are highlights from the October 2026 briefs. 

Low drug spending growth leads gradual decline in rate of national health spending growth

• In August 2026, national health spending grew by 6.5% year over year, down slightly from the revised July 2026 growth rate of 6.6%.
• GDP grew by 5.9% in August, year over year. As a result, national health spending in August constituted 18.4% of GDP, equal to the July value. National health spending was most recently below 18% of GDP in July 2024.
• Year-over-year growth in personal health care spending was 6.2% in August, year over year, slightly down from the revised July value of 6.3% and significantly lower than the 7.5% rate in August 2025. Utilization growth contributed nearly two-thirds of the increase, with price increases contributing one-third.
• Growth among major spending categories was highest in August for hospital care, at 8.0%, year over year, while spending for prescription drugs grew the slowest, at 1.3%. Drug spending growth has slowed significantly this year due primarily to a decline in drug prices; it stood at 7.8% in August 2025.

Prescription drug prices decline at a record rate

• In September 2026, the overall Health Care Price Index (HCPI) stood at 2.1%, down from 2.3% in August and from a recent peak of 3.2% in November 2025.
• Economy-wide inflation in September, as represented in the year-over-year change in the overall Consumer Price Index (CPI), equaled 3.7%, while the Producer Price Index (PPI) increased by 0.7 percentage points to 6.3%.  
• Among the major health care categories, prices for dental care in September were the fastest growing at 6.0% year over year. This is an increase from a growth of 3.2% in September of 2025. At the other extreme, prescription drug prices fell by a record 4.5%—their ninth straight month of lower year-over-year prices.
• For major payers in September, year-over-year Medicare prices growth for services (3.5%) exceeded private insurance (2.7%) and Medicaid (1.5%).  
• The implicit measure of health care utilization growth was 3.9% year over year in August, equaling its July value (September data are not yet available).
• Among major spending categories, hospital care utilization increased the fastest, at 4.9%. Utilization of dental services declined by 0.9%. 

Nursing facilities post significant job losses in September

• In September 2026, health care industry employment increased by 16,700 jobs while non-health care industries gained 12,300 jobs.  
• By major subsector, September’s health care job growth was led by ambulatory health care services which added 13,400 jobs, followed closely by hospitals which added 12,000. Nursing and residential facilities lost 8,700 jobs, the largest monthly loss since January of 2022.
• For health care and social assistance, the jobs opening rate was 5.4% and the hiring rate was 2.9% in August (September data is not yet available). The total separations rate was 3.0%.
• The overall unemployment rate was 4.2% in September, up 0.1% from August. 
• Nominal health care wage growth in August was 1.8% year over year, with growth rates of 1.4% in hospitals, 2.0% in ambulatory health care services, and 3.3% in nursing and residential care facilities.