The amount that consumers spend on healthcare in the United States typically fluctuates from year to year, but healthcare spending grew in 2014 at its fastest rate since 2007. Americans averaged $9,523 in spending, according to the Centers for Medicare and Medicaid Services (CMS). Much of this increase is from the implementation of the Affordable Care Act and the increase in Medicaid patients as a result.
When the Affordable Care Act increased coverage of insurance to people who had never had insurance before, it also increased the number of patients who could be serviced by government-run programs like Medicaid. In 2014 alone, 7.7 million people signed up for Medicaid, representing a boost in spending by the program of 11 percent. In some states low income patients represent a majority; homebound patients and those without the ability to travel long distances to see a physician are being cared for through the assistance of telemedicine, where the doctor can diagnose and treat a variety of patients who before just wouldn’t have been seen.
The CMS has been tracking consumer spending on healthcare in the United States for more than fifty years. It also tracks total spending as a percentage of the gross domestic product. While spending usually rises over time, the healthcare spending of 2014 surpassed growth of the economy by 1.2 percentage points, representing 17.5 percent of the United States’ GDP.
One of the main contributors to the higher healthcare spending is an increase in the cost of prescription drugs. CMS has noticed a more than 12 percent jump in spending on prescription medications, including some specialty Cancer and Hepatitis C drugs like Harvoni and Sovaldi that have been priced as high as $1,000/pill. Drug companies claim that most patients pay far less than this amount through their insurance, but even so, spending on prescriptions through doctor’s visits and telemedicine rose nearly ten percent higher in 2014 than the year prior, from 2.4 percent to 12.2 percent.