Healthcare spending, costs way up in 2001
Associated Press
WASHINGTON — Americans' healthcare spending soared 8.7 percent in 2001, the biggest increase in a decade, as prices surged for everything from prescription drugs to hospital stays.
The nation's healthcare budget jumped to $1.42 trillion, up from $1.31 trillion in 2000. The numbers mean healthcare spending averaged about $5,035 per person, according to a report issued by the Centers for Medicare and Medicaid, part of the Department of Health and Human Services.
The report, done annually to examine private and public sector spending, appears in the January/February issue of the journal Health Affairs.
The report's authors said the nation was feeling the effects of the recession, which followed months of growth and record employment — a time when many companies offered lucrative benefit packages to lure workers.
"Government and employers are feeling enormous pressure on their ability to finance rapidly rising spending with resources that are growing more slowly," said Katharine Levit, one of the authors.
The study found that healthcare is increasingly becoming a force in the economy, jumping from 13.3 percent of the gross domestic product in 2000 to 14.1 percent in 2001 — the largest increase since 1991.
Prescription drug spending — which made up $140.6 billion of total health spending — continued to grow faster than all other areas. However, the study's authors said the 15.7 percent growth rate in 2001 was down slightly from the previous year's 16.4 percent rate.
One of the biggest increases was in hospital spending, which increased 8.3 percent — the fastest growth for that sector in a decade.
Critics said the spending increases are proof that once-touted HMOs are losing their ability to control costs. Health insurance premiums grew 10.5 percent, while benefits grew slower, about 10.1 percent.
Public health programs were also hit by increases. Spending for Medicaid, the nation's health insurance program for the poor, grew 10.8 percent while Medicare spending grew 7.8 percent.
