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US Healthcare Spending Soars to $5.3 Trillion
15 Jan
Summary
- US healthcare spending reached $5.3 trillion in 2024, a 7.2% increase.
- Increased health insurance enrollment and medical service use fueled the rise.
- Healthcare costs now represent 18% of the U.S. gross domestic product.
U.S. healthcare spending experienced a substantial increase, reaching $5.3 trillion in 2024, which represents a 7.2% rise from the prior year's $4.9 trillion. This escalation is largely attributed to increased health insurance enrollment and a heightened demand for medical services, with private health insurance plans showing particular growth. As a result, healthcare expenditures now account for 18% of the U.S. gross domestic product, surpassing the nation's overall economic growth rate.
The administration of government health programs, including Medicare and Medicaid, saw the most significant increase in spending, rising by 14.7% in 2024 compared to a 7.8% increase a year earlier. This surge was partly due to changes in Medicaid coverage following the expiration of COVID-era policies, leading to a 19.8% rise in Medicaid government administration costs alone. Spending on services provided by non-medical professionals and home healthcare also climbed, with increases of 10.8% and 10.2% respectively.
