Health care costs are on a rapid upturn, and with a vengeance in 2015. According to an article in Health Affairs, nationwide spending reached $3.2 trillion last year, up 5.8% from 2014.
The article specified about health care spending growth:
On a per person basis, spending on health care increased 5.0 percent, reaching $9,990. The share of gross domestic product devoted to health care spending was 17.8 percent in 2015, up from 17.4 percent in 2014. Coverage expansions that began in 2014 as a result of the Affordable Care Act continued to affect health spending growth in 2015. In that year, the faster growth in total health care spending was primarily due to accelerated growth in spending for private health insurance (growth of 7.2 percent), hospital care (5.6 percent), and physician and clinical services (6.3 percent). Continued strong growth in Medicaid (9.7 percent) and retail prescription drug spending (9.0 percent), albeit at a slower rate than in 2014, contributed to overall health care spending growth in 2015.
Health care costs have an outsized effect on growth of gross domestic product and, thus, inflation. And inflation is one of the factors the Federal Reserve will examine as it looks toward a rate hike this month — the first in eight years.
Affordability is at the core of the national debate on health care funding. With expense rates up nearly 6%, the ability to afford care not only becomes more difficult. It raises the friction among doctors, hospitals, insurance companies and patients.
If the economy continues to recover, health care costs should continue to spike.