National Health Care Expenditures Growing Faster than U.S. GDP

Inflation and rising health care utilization are driving U.S. health care spending to grow faster than the country’s gross domestic product (GDP).

The nation’s health care spend is projected to reach nearly $5.1 trillion in 2024, up from $4.5 in 2022. This is according to a report in Health Affairs that also projected national health expenditures to reach more than $7.7 trillion by 2032, equal to 19.7% of the anticipated U.S. GDP for that year. During 2023 alone, national health care spending rose an estimated 7.5%. This is a faster rate than the GDP that year, which grew at 6.1%.

“This reflects broad increases in the use of health care, which is associated with an estimated 93.1% of the population being insured that year,” the Health Affairs report indicated. “In 2024, Medicaid enrollment is projected to decline significantly as states continue their eligibility redeterminations. Simultaneously, private health insurance enrollment is projected to increase.”


Factors driving the rate of increase include personal health care price inflation and growth in the use of health care services and goods, according to Health Affairs.

However, by 2023 the insured population will likely fall closer to 90%, due to the expiration of the Medicaid continuous enrollment requirements, Jacqueline Fiori, economist in the National Health Statistics Group at the U.S. Centers for Medicare & Medicaid Services (CMS), said during a virtual media briefing.

Spending by Medicare, hospice’s principal payer, is expected to reach close to $1.1 trillion this year, up from $944 billion in 2022.


“Underlying this differential or faster growth and personal health care prices relative to the economy wide price growth, the continued aging of the population and increasingly more demand for health care relative to income growth,” Fiori said.

Increased hospice utilization could help relieve part of the nation’s financial burden for health care, research has shown.

Hospice care saves Medicare roughly $3.5 billion for patients in their last year of life, according to a joint report from the National Hospice and Palliative Care Organization, the National Association for Home Care & Hospice (NAHC) and NORC at the University of Chicago.

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