National Health Expenditures 2021 Highlights – Cost Increases by Year Chart

Dr. June Gower

March 31, 2022



Dr. June Gower – The National Health Expenditures 2021 report shows that the U.S. is spending more on health care than any other country in the world. In fact, U.S. healthcare spending is much higher than other countries’. Norway spent the most on healthcare in 2010 at 11.3% of GDP, while Germany spent 12.5% of its GDP, or $6,731 per person. This report highlights recent changes in health care spending, such as the COVID-19 pandemic and the rise in Medicaid spending.

Dr. June Gower described that, In the new report, Altarum analyzes the latest data on health spending and prices, employment, and utilization. The data are supported by the Robert Wood Johnson Foundation. The study shows that health care spending in the U.S. will increase 9.7% in 2020, from 10.7% in 2010. However, the numbers do not reflect the full picture, as a recent COVID-19 pandemic has impacted some areas of the country’s health-care system.

june gower

june gower

In addition to the data on total health care spending, the NHE 2021 report shows the percentage of the population who is insured, as well as how the percentage will change over time. By 2028, the percentage of insured population is projected to reach 89.5 percent. The report outlines the projected change over the next decade, including the changes in the insured population. Further, the report includes data on the cost of health insurance for the elderly.

According to Dr. June Gower, while the increase in healthcare expenditure is significant, it is not as large as some experts had thought. The largest increases are seen in hospitals and ambulatory health care providers. The ratio of health-care expenses to GDP was 25.5 percent across the EU in 2019. In comparison, the growth rate in health care spending in Sweden was lower than the United States, although it was still significantly higher than in the United Kingdom.

The annual increase in health care spending is projected to be more than twice as high as in the last decade, with the health share of the economy increasing from 17.7 percent in 2017 to 19 percent in 2028. The deflator for personal health care measures the rate of price increases for medical goods and services. In addition, Medicare is expected to see its spending increase of 7.6 percent over the next two years, the fastest in the world.

The overall increase in health spending per person in the U.S. grew by 8.8% in 2018, with prices of food and energy increasing at an unprecedented rate. Meanwhile, the increase in health expenditure was largely unaffected by the COVID-19 pandemic, which revealed critical weaknesses in the U.S. healthcare sector. According to the report, the elderly and children under eighteen are the least expensive age groups in the U.S., while the elderly are the most expensive.

Dr. June Gower pointed out that, the growth in health spending is largely due to private insurance programs. These programs provide affordable coverage, which accounts for nearly two-thirds of total health spending. Public health care costs represent approximately 25.7% of the total U.S. GDP. The cost of insurance is an enormous part of the U.S. economy. In the United States, private health care costs account for only a fraction of the total national health spending.

Among the proposed policies, government-sponsored medical plans account for approximately two-thirds of healthcare spending. Likewise, private health insurance has a greater share in health-care spending than any other country in the world. For instance, compulsory schemes make up nearly three-quarters of health spending in Luxembourg and France. These policies also include state-funded plans, and other private sources of health-care revenues. The federal government and households are responsible for 36.3% of NHE in 2020.

In terms of price and utilization, Medicare and Medicaid accounted for the largest portion of the U.S. healthcare spending in 2019 and are projected to grow by 7.6% annually between now and 2028. Furthermore, private health insurance spending, which accounts for more than one-third of the national total, is expected to grow by 8.4% between now and 2028. The proportion of out-of-pocket healthcare spending rose by 6.7%, while prescription drugs accounted for four percent.