Health and Science

Americans shelled out $10,739 per person on health care last year, but growth in spending slows 

Key Points
  • The growth in health-care spending in the U.S. slowed considerably last year.
  • Spending grew by 3.9 percent last year, a rate not seen since 2013. 
  • Americans spent $3.5 trillion, or $10,739 per person, on health care last year.
A doctor examines a patient at the UCSF Women's Health Center in San Francisco, California.
Justin Sullivan | Getty Images

Americans shelled out $3.5 trillion on health care last year, or $10,739 per person, but the increase in spending slowed to a pace not seen since 2013 — before Congress expanded the Affordable Care Act.

Spending in 2017 grew at a rate of 3.9 percent, a marked slowdown after rising 4.8 percent in 2016 and 5.8 percent in 2015, federal officials said, citing new data released Thursday from the Centers for Medicare and Medicaid Services.

"Prior to the coverage expansions and temporary high growth in prescription drug spending during that same period, health spending was growing at historically low rates," the CMS said in a release. "In 2017, health care spending growth returned to these lower rates and the health spending share of GDP stabilized for the first time since 2013."

The slowdown was seen in hospitals, medical services, private and public insurance and prescription drugs, federal health officials said. The exception was spending on Medicare, the government-run health insurance program for the elderly and Americans with disabilities, which remained flat for the year.

Private health insurance saw the highest total spending, increasing 4.2 percent to $1.2 trillion, in 2017. The lowest spending was on retail prescription drugs, which reached $333.4 billion in 2017, an increase of 0.4 percent.

The new data comes at a time when health-care groups are being pressured by federal health officials to alter the way they deliver care, which includes facilitating more cooperation between health-care providers, in an effort to reduce sky-high costs and improve overall health outcomes for Americans.

The Trump administration currently has several proposals that would offer lower out-of-pocket costs for American consumers, which include changes to Medicare Part D and Part B.

When compared with the gross domestic product, total heath-care spending in the U.S. was flat last year, representing 17.9 percent of GDP. That's the same as the prior year and the first year that number didn't rise since 2013, according to Medicare.

The number of people with health insurance rose sharply in 2013, which coincided with the expansion of eligibility for Medicaid in many states as part of the Affordable Care Act. The expansion resulted in two years of higher spending. But by 2015, spending began to slow, officials said.

The health-care spending rate in 2017, which will appear in the January 2019 issue of "Health Affairs," was similar to the average annual rate of 3.9 percent during most of Barack Obama's term, from 2008 through 2013.