Health care spending in the United States increased by 4% in 2009, the slowest rate of growth in 50 years, a government report released this month shows.


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Spending on health care rises 4%

January 17th, 2011

WASHINGTON – Health care spending in the United States increased by 4% in 2009, the slowest rate of growth in 50 years, a government report released this month shows.

Despite the slower growth, the report from the office of the actuary at the Centers for Medicare and Medicaid Services (CMS) notes that although the nation’s economy contracted, health spending continued to expand, hitting an all-time high of $2.5 trillion.

As a result, health expenditures accounted for a record 17.6% of 2009’s total economic output. The nation spent $2.5 trillion on health care in 2009, for an average of $8,086 a person. Still, the report says that the growth in spending was kept to a minimum as people lost their jobs, lost health insurance and deferred medical care.

“Many consumers decreased their use of health care goods and services, partly because they had lost employer-based private health insurance coverage and partly because their household income had declined,” said Anne Martin, an economist and principal author of the report.
In many cases, she noted, people decided to “forgo health care services they could not afford.”

Despite the economy’s downturn, retail spending on prescription drugs grew at the greatest rate since the 8.9% increase between 2005 and 2006.

Retail purchases of prescription drugs now account for $1 of every $10 spent on health care.
The report shows that total prescription drug expenditures hit $249.9 billion in 2009, up 5.3%. A year earlier prescription spending increased by 3.1%.

CMS says the larger growth in 2009 was mainly the result of a more rapid increase in drug prices and in the number of prescriptions dispensed.

Meanwhile, spending on other health services declined as fewer people visited physicians and people spent less time in hospitals. Spending on dental services declined slightly, for instance, and spending on doctors’ services in 2009 increased at the slowest pace since 1996.

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