Healthcare costs to double by 2016

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U.S. healthcare spending is expected to double by 2016, according to a report published in the journal Health Affairs. Total spending should hit $4.1 trillion per year by that time which will represent about one-fifth of the national GDP (gross domestic product), the Washington Post/HealthDay News reports.

The authors of the report come largely from National Health Statistics Group (NHSG), Office of the Actuary, Centers for Medicare and Medicaid Services (CMS).

According to the report, growth is projected to slow slightly from 6.9 percent in 2005 to 6.8 percent in 2006. This marks a slow down for four consecutive years. Also, the experts believe that the health share of GDP held in 2006 before it will resume “its historical upward trend, reaching 19.6 percent of GDP by 2016.”

Highlights of the report include:

  • Medicare spending growth is projected to decrease 6.5 percent in 2007. But by 2016, Medicare spending is likely to double or do more than double and reach $862.7 billion;
  • Prescription drug spending should reach $497.5 billion by 2016;
  • Prescription drug spending will average around 8.6 percent growth until 2016;
  • Hospital care cost should hit $1.2 trillion by 2016. It was $651.8 billion in 2006; and
  • By 2016, the average spent by individuals will be around $1,405.73 annually.