The growth in healthcare spending slowed in 2002, but last year's rate of 9.6% is still "extremely high by historical standards," according to a study by the Center for the Study of Health System Change.
The 2002 rate is also much higher than the overall economy, which rose at a rate of 2.7% in 2002, as measured by per-capita growth in gross domestic product, the Washington, D.C.-based HSC said in a Wednesday release.
Last year's growth was driven by spending on prescription drugs, which, although it rose 13.2%, had slowed for the third year in a row, the report says.
In comparison, spending for physician services increased 6.5% and growth in utilization of inpatient and outpatient hospital services stood at 5.7% in 2002, after climbing 8% in 2001, the report says.
Hospital prices, on the other hand, increased 5.1% in 2002, the largest rise in a decade, perhaps because hospitals "may be seeking to pass through higher wage increases granted in response to labor shortages, particularly for nurses," the report says.
The report shows that despite cost-control innovations like three-tier co-payments for drugs, medical inflation is still a problem and will continue to push up health insurance rates.
"Unless underlying health care cost trends slow significantly, health insurance premiums will continue to rise rapidly and the number of uninsured Americans will increase," says HSC President Paul Ginsburg, a co-author of the study, in a release.
In addition, businesses will be asking patients to foot a larger part of their medical bills, says Helen Darling, president of the Washington Business Group on Health.
"Businesses can't continue to absorb the rapid increases in health care costs," Darling says in the HSC release. "Modest increases in cost sharing have been a part of employers' benefits strategy for the past two years, and employers will have to continue to share the burden of higher health costs with workers."