The Centers for Medicare & Medicaid Services (CMS) says national health expenditure growth is expected to average 5.6 percent annually from 2016 through 2025, outpacing projected growth in Gross Domestic Product (GDP) by 1.2 percentage points.
CMS says the projections in the report from the agency’s Office of the Actuary (OACT) are constructed using a current-law framework and do not assume potential legislative changes over the projection period.
The gap will result in the health share of GDP rising from 17.8 percent in 2015 to 19.9 percent by 2025, according to the report. The study anticipates projected faster growth in medical prices partially offset by slowing growth in the use and intensity of medical goods and services.
Total health spending in 2016 is projected to have reached nearly $3.4 trillion, a 4.8-percent increase from 2015. The report also found that by 2025, federal, state and local governments are projected to finance 47 percent of national health spending, a slight increase from 46 percent in 2015.