National Health Spending to Outpace GDP Growth Through 2033

The annual growth in national health spending is expected to be faster than average gross domestic product (GDP) growth during 2024 to 2033. According to a study published in Health Affairs, Sean P. Keehan and colleagues from the U.S. Centers for Medicare & Medicaid Services in Baltimore projected national health expenditures for 2024 to 2033. The authors note that national health expenditures are projected to increase by 8.2 and 7.1 percent in 2024 and 2025, respectively, reflecting continued strong growth in health care services and goods use.

Key Takeaways:

• National health expenditures are projected to increase 8.2 and 7.1 percent in 2024 and 2025, respectively, driven by strong growth in health care services and goods use.
• Health spending growth is expected to average 5.6 percent during 2026 to 2027, partly due to a decline in the share of the population with health insurance and partly due to an anticipated slowdown in utilization growth.
• For the full 2024 to 2033 projection period, national health care expenditure growth is expected to outpace that of the GDP each year, averaging 5.8 percent versus 4.3 percent.
• The health share of GDP is expected to reach 20.3 percent by 2033, an increase from 17.6 percent in 2023.
• Future legislative and regulatory health policy changes could have a significant impact on the projections of health insurance coverage, health spending trends, and related cost-sharing requirements.

Statistics:

• National health expenditures projected to increase by 8.2 and 7.1 percent in 2024 and 2025, respectively.
• Average health spending growth projected to be 5.6 percent during 2026 to 2027.
• Proposed health care expenditure growth averaging 5.8 percent versus 4.3 percent GDP growth through 2033.
• Projected health share of GDP to reach 20.3 percent by 2033 (from 17.6 percent in 2023).

Sources:

• Health Affairs, "National health expenditures projections, 2024-2033"
• Sean P. Keehan, from the U.S. Centers for Medicare & Medicaid Services in Baltimore
• The U.S. Centers for Medicare & Medicaid Services