Total health care spending reached 17.4 percent of gross domestic product (GDP) in 2013, and that share is expected to continue to grow significantly, according to the Centers for Medicare and Medicaid Services. Given this trend, it is critical to develop an understanding of what those increased expenditures represent. Are the increases attributable to rising costs of treatment or more individuals receiving medical care? What medical conditions account for the majority of spending? Which medical conditions see the cost of treatment rising most rapidly? Do these spending increases coincide with improvements in treatment? Answers to these questions are necessary in order to formulate policies that allow for society’s efficient consumption of health care as well as for the improvement of the nation’s overall health status.
The Bureau of Economic Analysis (BEA) has been conducting research to develop a health care satellite account (HCSA)—engaging in methodological research, evaluating new data sources, collaborating with academic researchers, and working jointly across multiple federal agencies (see the SURVEY OF CURRENT BUSINESS articles (2007),(2008),(2009),(2012),(2013)). The account builds on research by prominent health economists, recommendations from two reports of the National Academy of Sciences’ Committee on National Statistics, and years of research both at BEA and the Bureau of Labor Statistics (BLS).
This first release of the HCSA presents preliminary estimates that may be used to improve our understanding of health care spending trends and its effects on the U.S. economy.
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Real gross domestic product (GDP) increased at an annual rate of 5.0 percent in the third quarter of 2014, reflecting positive contributions from 20 of 22 industry groups. The private goods- and services-producing industries, as well as the government sector, contributed to the increase.
- The leading contributors to the increase were finance and insurance; mining; and real estate and rental and leasing.
- Finance and insurance real value added increased 21.2 percent in the third quarter, after increasing 6.0 percent.
- Mining increased 25.6 percent, after increasing 11.5 percent.
- Real estate and rental and leasing increased 4.4 percent, after increasing 0.9 percent.
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New statistics tracking the changes in the prices to treat different diseases are slated to be available Thursday, Jan. 22 when the Bureau of Economic Analysis publishes a new health care satellite account report.
The statistics – the first of their kind – provide information about the changes in prices to treat different diseases – illustrating trends in prices over time. The statistics cover 2000-2010 and will be contained in a report published in the January Survey of Current Business. Another new set of annual statistics that track how much is spent to treat different diseases over that same 10-year period also will be released. These new statistics are derived from large medical claims databases that include millions of individuals and billions of claims.
BEA’s new detailed, health care statistics will provide businesses, households and policymakers with even more data to make informed decisions.
These new health care statistics emerge from a multiyear project to improve the way health care spending is measured throughout the U.S. economy. Health care spending is an important part of the U.S. economy, accounting for 17.4 percent of Gross Domestic Product in 2013, according to the Centers for Medicare and Medicaid Services.