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What You Should Know About Health-Care Spending in the U.S.

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Despite a slowdown in the growth rate of overall national health expenditures, Americans are seeing more of their paychecks go to health-care costs.

The increase is largely thanks to cost-shifting through higher deductibles in plans offered by employers, which cover the majority of workers and their families. The trend has hit middle-income households the hardest. Here are five things to know about trends in U.S. health-care spending.

The Big Picture

Growth in health-care spending has slowed since the recession and the passage of theAffordable Care Act. It was down to 5.5% annual growth in 2015, from an average of nearly 8% in the two decades preceding the recession, according to the Centers for Medicare and Medicaid Services. Some of the recent slowdown is cyclical. Many of the millions of people laid off during the recession lost access to employer-provided health insurance, and broad-based belt-tightening also forced cutbacks in health spending. But as the economy grows and earnings rise, spending on health care is expected to re-accelerate, reaching a 6% annual average growth rate between 2020 and 2025, according to CMS projections. The pickup in spending would be in large part due to America’s aging population, although other trends, such as reforms to Medicare reimbursement and “spillover effects” in the private market, will help counter some of the increase.

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Topics: american health care, health insurance, healthcare, HR, hrbenefits, insurance broker, rising costs in insurance