National health spending is expected to grow at an average annual rate of 5.6 percent from 2016 through 2025, with expenditures projected to hit $5.5 trillion in 2025, according to new estimates from CMS' Office of the Actuary published Wednesday in Health Affairs.
Although congressional Republicans are working on a plan to repeal and replace the ACA, it isn't possible to determine the impact of potential policy changes on health spending and health insurance at this time. Therefore, the national health expenditure projections are constructed using current law and do not assume potential legislative changes over the projection period.
Here are five takeaways from the CMS report.
1. Health expenditures are expected grow faster than gross domestic product over the next decade. Healthcare is projected to make up 19.9 percent of the economy by 2025, up from 17.8 percent in 2015.
2. National health expenditures are estimated to have grown 4.8 percent in 2016. That's down from 5.8 percent growth in 2015.
3. "After an anticipated slowdown in health spending growth for 2016, we expect health spending growth to gradually increase as a result of faster projected growth in medical prices that is only partially offset by slower projected growth in the use and intensity of medical goods and services," said Sean Keehan, the study's first author.
4. National health spending growth is projected to accelerate to 5.4 percent in 2017 and to an average of 5.9 percent for 2018-19 due to faster growth in Medicare and Medicaid spending.
5. CMS expects nearly 91.5 percent of the U.S. population to have health coverage by 2025, up from 90.9 percent of the population in 2015.
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