Health Care Spending Growth: How Different Is the United States from the Rest of the OECD

Congressional Budget Office, Washington, DC, USA.
Health Affairs (Impact Factor: 4.97). 01/2007; 26(1):154-61. DOI: 10.1377/hlthaff.26.1.154
Source: PubMed


This paper compares the long-term (1970-2002) rates of real growth in health spending per capita in the United States and a group of high-income countries in the Organization for Economic Cooperation and Development (OECD). Real health spending growth is decomposed into population aging, overall economic growth, and excess growth. Although rates of aging and overall economic growth were similar, annual excess growth was much higher in the United States (2.0 percent) versus the OECD countries studied (1.1 percent). That difference, which is of an economically important magnitude, suggests that country-specific institutional factors might contribute to long-term health spending trends.

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    • "Health spending has dramatically increased in recent decades due to several factors such as demographic trends or the widespread diffusion of expensive technological advances in medical practice (White, 2007). At global level, data from World Health Organization show that total expenditure on public and private health reached a much larger proportion of gross domestic product – 10.4% in 2010 compared to 8.2% in 2000 and has almost doubled on a per capita basis from US$485 spent in 2000 to US$947 in 2010. 1 At European level, overall health spending grew by an average of more than 4% per year, ranging from 1.9% in Italy to 10.3% in Slovak Republic (OECD Health Data 2012). "
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    • "Rising levels of demand due to ageing populations and increases in long-term conditions (White, 2007), increased levels of expectation amongst patients and inflationary pressure caused by the rising cost of new technologies are amongst the explanations for the funding shortfalls in government funded health systems across the world. The challenge facing these health systems has also been intensified by the worldwide economic downturn. "
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