June 06, 2023
Understanding trends and drivers of health care costs is an important issue for individuals, businesses, and policymakers, and explaining recent changes in the health spending trajectory using new data can offer insights into where costs may be headed in the future.
In 2022, US health care spending growth slowed down, driven predominantly by slower than expected increases in private insurance and Medicare spending and slower overall growth in health care prices relative to economy-wide inflation. Health care spending as a percentage of GDP fell to 17.3% in 2022, down from 19.7% in 2020 and the lowest share since 2014. This 17.3% proportion of GDP is well below the expected average CMS projection of 19.0% resulting in a reduction of $420 billion dollars in total health expenditures for 2022.
Looking ahead to 2023, Corwin (Corey) Rhyan and George Miller analyze the factors influencing this decline and offer insights on the future trajectory of health care spending depending on the major driving trends and factors. They discuss slower than expected growth in private insurance spending through 2022 and possible factors such as higher deductibles, greater cost sharing, health care labor supply constraints, and lower overall health care price growth. They conclude their piece by shedding light on the evolving landscape of health care spending and implications for the future.
Read more in "An Early Look At What Drove 2022's Health Care Spending Slowdown" in Health Affairs Forefront.
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Research Director, Health Economics and PolicyAreas of Expertise
Corey develops tools that model the societal benefits of improved population health and conducts economic analyses of health sector policies. He holds a master’s degree in public policy from the University of Michigan and a bachelor’s degree in economics from Washington University in St. Louis.
Fellow and Research Team LeaderAreas of Expertise
Dr. George Miller is a fellow participating in Altarum's efforts to track national spending, analyze the drivers of spending growth, and quantify a sustainable spending growth rate. Dr. Miller received his BSE, MSE, and PhD degrees in industrial and operations engineering from the University of Michigan, where he subsequently served as an adjunct assistant professor.