Health Care Spending Growth Slows

The rate of growth for medical services varied fairly significantly by the type of service until the last decade or so.

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“During the 1970s, growth in hospital expenditures outpaced other services, while prescriptions and physicians/clinics saw faster spending growth during the 1980s,” Rabah Kamal and Cynthia Cox of the Kaiser Family Foundation noted in a December report. Prescription drug prices continued to soar during the 1990s as well.

By the 2000s, however, growth was beginning to slow. Between 2010 and 2017, spending on prescription drugs grew at an annualized rate of 4%, spending on physicians/clinics rose 4.4%, and spending on hospitals and clinics increased 4.8%.

Spending on hospitals and physician services accounted for 53% of U.S. health spending in 2017.