National Health Spending in 2011: Overall
Growth Remains Low But Some Payers and
Services Show Signs of Acceleration
Micah Hartman
Anne Martin
Joseph Benson
Aaron Catlin
and
The National Health Expenditure Accounts Team
1
2011 National Health Expenditure Accounts: Highlights
 National health spending increased 3.9 percent in 2011, the
same rate of growth as in 2009 and 2010
 National health spending reached $2.7 trillion, or $8,680 per
person in 2011
 The share of Gross Domestic Product (GDP) devoted to health
care spending remained steady from 2009 through 2011 at 17.9
percent
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
2
2011 National Health Expenditure Accounts: Highlights
 Personal health care (PHC) spending increased 4.1 percent in
2011—a slight acceleration from growth of 3.7 percent in 2010
 Growth in non-price factors such as the use & intensity of health
care goods and services increased in 2011
 Spending for retail prescription drugs, physician and clinic’s
services grew at a quicker pace in 2011
 Medicare, private health insurance, and consumer out-ofpocket spending growth picked up in 2011
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
3
Affordable Care Act
 Affordable Care Act provisions effective in 2010 and 2011 had
minimal impact on overall growth
 Sector and payer specific impacts include:



Private health insurance


Under twenty-six provision
Medical Loss Ratio
Retail Prescription Drugs


Part D coverage gap
Medicaid retail prescription drug rebates
Medicare Program


Payment rate updates
Preventative services
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
4
Recessionary Impact on National Health Expenditures
2008-2010
 2008- Slowdown from growth of 6.2 (2007) to 4.7 (2008)

Private health insurance enrollment, other private revenues, out-ofpocket spending growth slowed or declined
 2009- Slowdown from growth of 4.7 (2008) to 3.9 (2009)

Decline in structures and equipment investment, private health
insurance enrollment, and slower growth in out-of-pocket spending
 2010- Flat from growth of 3.9 (2009) to 3.9 (2010)

Historically low growth in personal health care goods and services (3.7)
due in part to decline in use and intensity
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
5
Growth in National Health Expenditures and
Gross Domestic Product (GDP), 1985-2011
12.0
July 1990March 1991
Recession
Annual Percent change
10.0
March 2001November 2001
Recession
December
2007-June
2009
Recession
8.0
6.0
4.0
2.0
0.0
2009
2007
2005
2003
2001
1999
1997
1995
1993
1991
1989
1987
-4.0
1985
-2.0
Calendar Years
NHE
GDP
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group, U.S
Department of Commerce, Bureau of Economic Analysis and National Bureau of Economic Research, Inc.
6
National Health Expenditures as a Share of
Gross Domestic Product, 1985-2011
20.0
17.9%
18.0
16.0
Percent of GDP
14.0
12.0
July 1990March 1991
Recession
10.0
8.0
December
2007 June
2009
Recession
March 2001November
2001
Recession
6.0
4.0
2.0
0.0
2011
2009
2007
2005
2003
2001
1999
1997
1995
1993
1991
1989
1987
1985
Calendar Years
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group,
Department of Commerce, Bureau of Analysis and National Bureau of Economic Research, Inc.
7
Factors Accounting for Growth in Per Capita National
Health Expenditures and Personal Health Care, Selected
Calendar Years 2004-2011
Other nonprice factors
Age and sex factors
Medical prices
Per capita spending growth
6.5%
6.0%
5.5%
5.0%
National health expenditures
4.5%
Personal health care expenditures
Percent
4.0%
3.5%
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
-0.5%
Average
annual
growth 20042008
2008
2009
2010
2011
Average
annual
growth 20042008
2008
2009
2010
2011
SOURCE Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group. NOTES Medical price growth, which includes
economy-wide and excess medical-specific price growth (or changes in medical-specific prices in excess of economy-wide inflation), is calculated using the
chain-weighted national health expenditures (NHE) deflator for NHE and the chain-weighted personal health care (PHC) deflator for PHC expenditures. As a
residual, the category of other non-price factors includes use and intensity and any errors in measuring prices or total spending.
8
The Nation’s Health Dollar ($2.7 Trillion),
Calendar Year 2011: Where It Went
Dental Services and
Other Professionals
7%
Prescription
Drugs
10%
Government
Administration and Net
Cost of Health Insurance
7%
Investment1
6%
Physicians and Clinics
20%
Hospital Care
31%
Other
14%
Nursing Care Facilities
and Continuing Care
Retirement Communities
6%
Other Medical Products2
3%
Government
Public Health
Activities
Home
3%
Health
Care
3%
Other Health,
Residential, and Personal
Care3
5%
1
Includes Research (2%) and Structures and Equipment (4%).
Durable (1%) and Non-durable (2%) goods.
3 Includes expenditures for residential care facilities, ambulance providers, medical care delivered in non-traditional
settings (such as community centers, senior citizens centers, schools, and military field stations), and expenditures
for Home and Community-based Waiver programs under Medicaid.
Note: Sum of pieces may not equal 100% due to rounding.
2 Includes
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
9
Annual Growth in Spending by Type of Service,
2010 and 2011
National Health Expenditures
3.9
3.9
Gov’t Admin & Net Cost of Health Insurance
8.1
4.1
Investment
2.1
Public Health Activities
2.9
4.9
-0.5
Personal Health Care
3.7
4.1
Hospital Care
4.3
3.1
Physician and Clinical Services
4.9
4.3
4.6
4.9
Other Professional Services
2.7
3.0
Dental Services
Other Health, Residential, & Personal Care
4.0
Home Health Care
4.5
4.5
3.2
Nursing Care Facilities1
0.4
Retail Prescription Drugs
5.8
4.4
2.9
4.8
4.6
Other Medical Products2
-2.0
0.0
2.0
1
Includes Continuing Care Retirement Communities
2
Includes Durable Medical Equipment and Other Non-Durable Medical Products
4.0
2010
6.0
8.0
10.0
2011
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
10
31%
Hospital Spending, Annual Growth,
2000 - 2011
9.0
8.0
6.7
7.0
6.0
5.0
4.9
4.0
4.3
3.0
2.0
• $850.6 billion in 2011
• Slower Growth in 2011
– A slowdown in price
growth and low growth
in utilization
– Slower growth in
Medicaid
• Acceleration in Private
Health Insurance and
Medicare
1.0
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0.0
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
11
20%
Physician and Clinical Services Spending,
Annual Growth, 2000 - 2011
9.0
8.0
7.0
6.0
5.0
4.3
4.0
3.5
3.0
3.1
2.0
1.0
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0.0
• $541.4 billion in 2011
• Acceleration in 2011
– Increase in growth in use
and intensity of services;
slower growth in prices
– Clinical services’ spending
increasing faster than
physician services’
spending
– Acceleration in Private
Health Insurance and
Medicare
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
12
10%
Retail Prescription Drugs Spending,
Annual Growth, 2000- 2011
• $263.0 billion in 2011
• Faster growth in 2011
18.0
16.0
– Brand name and specialty
drug price accelerated
– Increased spending on new
brands
14.0
12.0
10.0
8.0
6.0
5.0
4.0
2.9
2.0
2011
2010
2008
2007
2006
2005
2004
2003
2002
2001
2000
2009
0.4
0.0
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
13
The Nation’s Health Dollar, Calendar Year 2011:
Where It Came From
Other Third Investment
6%
Party Payers
and
Programs1
7%
Government
Public Health
Activities
3%
Medicaid
(Title XIX)
State and
Local 6%
Out-ofpocket2
11%
Health
Insurance
73%
VA, DOD,
and CHIP
(Titles XIX
and Title
XXI)
4%
Medicaid
(Title XIX)
Federal
9%
Medicare
21%
Private
Health
Insurance
33%
Health Insurance
1 Includes
worksite health care, other private revenues, Indian Health Service, workers’ compensation, general
assistance, maternal and child health, vocational rehabilitation, Substance Abuse and Mental Health Services
Administration, school health, and other federal and state local programs.
2 Includes co-payments, deductibles, and any amounts not covered by health insurance.
Note: Sum of pieces may not equal 100% due to rounding.
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
14
Annual Growth in Spending by Source of Funds,
2010 and 2011
3.9
3.9
National Health Expenditures
2.1
Out-of-pocket
2.8
4.4
4.3
Health Insurance
3.4
3.8
Private Health Insurance
4.3
Medicare
6.2
5.9
Medicaid (Title XIX)
2.5
5.1
Total CHIP (Title XIX and Title XXI)
3.0
4.3
Department of Defense
3.6
8.6
8.7
Department of Veterans Affairs
4.1
4.1
Other Third Party Payers & Programs
2010
2011
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
15
33%
8%
Private Health Insurance: Growth in Enrollment,
Premiums, and Benefits, 2007 – 2011
Total PHI: Growth in
Enrollment, Premiums, and
Benefits
Per Enrollee: Growth in
Premiums and Benefits
8%
7%
7%
6%
6%
5%
5%
4%
4%
3%
3%
2%
2%
1%
1%
0%
0%
-1%
2007
2008
2009
2010
2011
2007
2008
2009
2010
2011
-2%
-3%
Premiums per enrollee
-4%
Benefits per enrollee
PHI Enrollment
Premiums
Benefits
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
16
21%
Medicare: Growth in FFS and Medicare Advantage
Expenditures and Enrollment, 2007 – 2011
Fee-for-Service
Medicare Advantage
25%
25%
20%
20%
15%
15%
10%
10%
5.3%
4.9%
5%
4.1%
4.3%
2.7%
5.6%
5%
3.4%
4.5%
1.5%
0%
0%
-1.1%
2007
2008
2009
2010
2011
-5%
FFS Enrollment
2007
2008
2009
2010
2011
-5%
FFS Spending
Per FFS enrollee
MA Enrollment
MA Spending
Per MA enrollee
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
17
15%
Medicaid: Growth in Enrollment and Total,
Federal, and State & Local Expenditures,
2007 – 2011
Total Medicaid Expenditures
and Enrollment
Federal and State & Local
Medicaid Expenditures
10%
2007
6.3%
6.7%
5.7%
2008
5.8%
9.6%
8%
6.2%
0.7%
6%
2009
4%
2.2%
1.4%
2%
1.0%
8.8%
-10.0%
5.9%
7.7%
2.5%
2010
0%
-0.7%
2011
-7.1%
2.5%
22.2%
-2%
2007
2008
Enrollment
2009
Spending
2010
21.9%
2011
Per enrollee
Total
Federal
State/local
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
18
11%
Out-of-Pocket Expenditures
Growth in Out-of-Pocket
Spending, 2007-2011
Shares of Out-of-Pocket Spending
by Type of Service, 2011
8%
Hospital Care,
9%
Other1, 24%
Physician and
Clinical
Services, 17%
6%
5.3%
4%
2.8%
Prescription
Drugs, 15%
2.4%
Dental
Services, 15%
2.1%
2%
Nursing Care
Facilities, 13%
Home Health
Care, 2%
Other
Professional
Services, 6%
0.1%
0%
1
“Other” includes out-of-pocket spending for Durable Medical Products (7%),
Other Nondurable Medical Products (14%), and Other Health, Residential, and
Personal Care (2%). Totals may not sum due to rounding.
2007
2008
2009
2010
2011
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
19
Distribution and Annual Growth
by Type of Sponsor
Distribution of National Health
Expenditures by Type Of Sponsor,
2007 and 2011
20%
100%
90%
18%
17%
State and local
government
23%
28%
Federal
government
80%
70%
60%
50%
40%
7%
29%
30%
15%
10%
5%
7%
28%
Other Private
Revenues
Households
0%
-5%
2007
20%
10%
Annual Growth in Spending
by Sponsor, 2007 - 2011
23%
21%
2007
2011
Private Business
0%
2008
2009
2010
2011
State and Local Government
Federal Government
Private Business
Households
Note: Sum of pieces may not equal 100% due to rounding.
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group;
20
2011 National Health Expenditure Accounts:
Summary

National Health Expenditures reached $2.7 trillion, or $8,680 per person in 2011

National Health Expenditures increased 3.9 percent in 2011

National Health Expenditures represented a 17.9 percent share of Gross Domestic Product (GDP)
for the third consecutive year

Spending grew faster in 2011 for:
• Retail prescription drugs (2.9 percent)
• Physician and clinical services (4.3 percent)
• Medicare (6.2 percent)
• Private health insurance (3.8 percent)
• Out-of-pocket (2.8 percent)

Spending grew at a slower rate in 2011 for:
• Hospital services (4.3 percent)
• Medicaid (2.5 percent)

Sponsors of Health Care (% share in 2011)
• Federal government (28 percent)
• Households (28 percent)
• Private businesses (21 percent)
• State and local government (17 percent)
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.
21