Total hospital spending is expected to grow by only 6.6% in 2006, to $651.8 billion, which is a significant decrease from the 2005 rate of 7.9% and the first slowdown in that sector since 2003. Meanwhile, growth in physician and clinical spending is expected to slow to 6.1% in 2006, to $447 billion, from 7% in 2005, according to data analysis of the National Health Statistics Group at the CMS.
Overall, the growth in healthcare spending is expected to drop slightly from 6.9% in 2005 to 6.8% in 2006, marking the fourth consecutive decrease in spending, the data show. The CMS attributes the slowdown to the addition of the Medicare drug benefit, slower projected growth in Medicaid and slower growth in private healthcare spending.
Authors of the report estimated that prescription drug spending is expected to grow 6.5% in 2006. If Part D had never been implemented, growth would have been nearly at 7%, an indication that the program is resulting in some savings to beneficiaries. Over the next decade, however, U.S. healthcare spending is projected to double from todays level, reaching $4.1 trillion and consuming 20 cents of every dollar spent by 2016, the report found. The report was published as a Health Affairs Web-exclusive article. -- by Jennifer Lubell and Matthew DoBias