At the same time, proposals that could increase Medicare spending are also being discussed, or have been adopted, including policies related to provider payments and Medicare benefit improvements. Part B, which covers physician visits, outpatient services, preventive services, and some home health visits, is financed primarily through a combination of general revenues (73% in 2021) and beneficiary premiums (25%) (and 2% from interest and other sources). For example, the NHEA places inpatient hospitalization and other medical services (outpatient hospital care, emergency room services, etc.) Goods are classified according to the product codes used by the U.S. Census Bureau. Within broad federal guidelines, each state . Medicare benefit spending is expected to grow to $1.8 trillion in 2031 (Figure 3). For the best user experience, we recommend using the lastest version of Google Chrome. This percentage islower than in 2010, when Congress made changes to how Medicare Advantage plans are paid, but it has beentrending higher since 2017. This projection does not take into account any savings to Medicare associated with implementation of the prescription drug provisions in the Inflation Reduction Act, which CBO projects will reduce the federal deficit by $237 billion between 2022 and 2031. In addition, retail prescription drug spending is projected to increase by an average of 5% per year, hospital spending growth is projected to average 5.7%, and physician and clinical services spending is projected to increase an average of 5.6% per year. Juliette Cubanski In addition, policymakers have expressed interest in other policies that could increase Medicare spending, such as enhancing Medicares benefit package by adding coverage of vision, hearing, and dental care, adding an out-of-pocket spending cap to traditional Medicare, making permanent Medicare coverage of telehealth, and strengthening financial protections for low-income beneficiaries. Selected highlights in projected health expenditures for the three largest goods and services categories are as follows: Hospital: Hospital spending growth is projected to average 5.7% for 2021-2030. CMS Releases National Health Care Expenditure Projections for 2021 to Medicare expenditures per beneficiary were highest in Florida ($13,652) and lowest in Vermont ($8,726) in 2020. According to the Congressional Budget Office, higher payments to Medicare Advantage plans, relative to traditional Medicare spending, are due to three factors. We applaud CMS for its appropriate use of an NCD with CED as a condition for reimbursement of these monoclonal antibodies for Alzheimers treatment (antiamyloid mAbs), as the current evidence base is insufficient to determine whether this treatment modality is reasonable and necessary for any given patient. (DMEPOS) Providers by Specialty, CY 2021; Medicare Prepaid Contracts, January 2023; National Health Expenditures, CY 2021; CMS Financial Data, FY 2022 ; Resources. National Health Expenditure (NHE) Fact Sheet | Guidance Portal - HHS.gov Spending on Part D prescription drug benefits has been a roughly constant share of total Medicare spending since the drug benefit began in 2006 (around 12-13%) and is expected to account for a similar share in the coming decade (11% in 2031). Reported data are for activities which take place during the calendar year. Looking at the average annual rate of growth in Medicare spending, both overall and per beneficiary, growth was notably slower in the most recent decade (2010-2020) than in prior decades, and somewhat slower than growth in private health insurance (PHI) per capita spending. Private health insurance spending grew 5.8% to $1,211.4 billion in 2021, or 28 percent of total NHE. The Office of the Actuary, which is independent from CMS leadership, projects that the government, businesses and households spent $4.44 trillion on healthcare in 20224.3% more than the prior yearor 17.4% of GDP. Before sharing sensitive information, Every five years, the Economic Census collects extensive statistics about businesses that are essential to understanding the American economy. Growth in the nations Gross Domestic Product (GDP) is also projected to be 5.1% annually over the same period. Selected highlights in national health expenditures by major payer include: Medicare: Medicare spending growth is projected to average 7.2% over 2021-2030, the fastest rate among the major payers. Beyond that, time period differences between the two surveys, as well as adjustments for population, could also further explain that gap between estimates. The program was expanded in 1972 to. HHS is committed to making its websites and documents accessible to the widest possible audience, An official website of the United States government. This standard is necessary to determine true clinical efficacy of antiamyloid mAbs on cognition and function, given the limited and contradictory evidence presented to date. National Health Expenditure Accounts are comprised of the following: National Health Expenditures National health expenditures (NHE) reached $4.1 trillion in 2020 a 9.7 percent increase over the 2019 level of $3.8 trillion. We commend CMS for its rapid and thorough approach to this proposed NCD, which will ensure appropriate access to antiamyloid mAb treatment while limiting Medicare spending growth and fostering a competitive marketplace for antiamyloid mAb treatments. Centers for Medicare & Medicaid Services 7500 Security Boulevard, Mail Stop N3-26-00 Baltimore, MD 21244 OFFICE OF THE ACTUARY DATE: March 31, 2023 FROM: Stephen K. Heffler Todd G. Caldis Sheila D. Smith Gigi A. Cuckler SUBJECT: The Long-Term Projection Methods for Medicare and Aggregate National Health Expenditures In 2019, current (nominal dollars) spending for national health expenditures was $3,795 billion. Latest CMS Data Reveal the Truth About U.S. Drug Spending ICYMI: The econowonks at the Centers for Medicare & Medicaid Services (CMS) recently dropped the latest National Health Expenditure (NHE) data, which measures all U.S. spending on healthcare. USC-Brookings Schaeffer Initiative for Health Policy. Thank you for visiting GRSconsulting.com! Between 2020 and 2030, Medicare per capita spending is projected to grow at a faster rate than between 2010 and 2020, on par with average annual growth in per capita private health insurance spending (5.4% vs. 5.3%). Health care expenditures - Health, United States - Centers for Disease In 2020, the New England and Mideast regions had the highest levels of total per capita personal health care spending ($12,728 and $12,577, respectively), or 25 and 23 percent higher than the national average. The NHEA covers the larger resident population, which includes all persons, both military and civilian, living in the United States. Funds for Part A benefits provided by Medicare Advantage plans are drawn from the Medicare HI trust fund (accounting for 42% of Medicare Advantage spending on Part A and B benefits in 2021). The NHEA data were obtained from the Centers for Medicare & Medicaid Services, Downloads, "NHE Tables," https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/nationalHealthAccountsHistorical.html. Whats at stake for China in the Wagner rebellion? In 2022, spending growth dropped to 4.8 percent compared with 8.4 percent in 2021 because fee-for-service beneficiaries were using fewer emergency department services and as a result of reinstated payment rate cuts associated with the Medicare Sequester Relief Act of 2022. The CE obtains information from individual consumer units, while the NHEA uses information from U.S. businesses from the SAS and the Economic Census. Wyomings personal health care spending was lowest in the nation (as has been the case historically), representing just 0.1 percent of total U.S. personal health care spending in 2020. What to Know about Medicare Spending and Financing, prescription drug provisions in the Inflation Reduction Act, $10.8 billion, or 1.3% of total program spending, 8% of total net plan benefit payments in 2021, significant impact on Medicare spending and financing, FAQs on Medicare Financing and Trust Fund Solvency, Medicare Advantage 2023 Spotlight: First Look, An Overview of the Medicare Part D Prescription Drug Benefit, Key Facts about Medicare Spending and Financing. We support the proposed requirement that all approved trials be designed to test for statistically significant and clinically meaningful differences in cognition and function due to antiamyloid mAbs. Through 2030, average total physician and clinical services spending growth of 5.5% is expected to primarily reflect decelerating spending growth for private health insurance enrollees in lagged response to projected slower growth in incomes earlier in the period. Karaganovs nuclear rant ought to scare Lukashenko. The independent source for health policy research, polling, and news. PDF Table HExpType. National health expenditures, average annual percent The .gov means it's official. What is the fallout of Russias Wagner rebellion? Third, Medicare Advantage plans typically receive higher payments based on their quality-based star ratings ($10 billion in 2022, according to KFF analysis), but these bonus payments do not apply to traditional Medicare. Healthcare expenditures grew 2.7% in 2021, 10.3% in 2020 and 4.2% in 2019, the year before the COVID-19 pandemic began. In 2014, children accounted for approximately 24 percent of the population and about 11 percent of all PHC spending. In terms of revenues, the pandemic initially resulted in a substantial increase in unemployment that caused a drop in payroll tax revenue to the HI trust fund. Dating back to 1960, the NHEA measure annual aggregate U.S. spending for healthcare goods and services, public health activities, program administration, the net cost of private insurance, and research and other investment related to healthcare. We further support the proposal that approved clinical trials will be considered to meet the CED requirements in the Beta Amyloid Positron Emission Tomography in Dementia and Neurodegenerative Disease NCD (220.6.20). PDF 2020 Medicaid and CHIP Beneficiary Profile: Characteristics, Health In 2021, Medicare spending, net of income from premiums and other offsetting receipts, totaled $689 billion and accounted for 10% of the federal budgeta similar share as spending on Medicaid, the Affordable Care Act (ACA), and the Childrens Health Insurance Program combined, and defense spending (Figure 2). According to CMS, national health care spending in 2021 slowed to 4.2% from 9.7% in 2020. CIDSA is a group of prescription drug policy experts without ties to the pharmaceutical industry that offers a central, objective source of information on drug spending and regulatory policy for policymakers and the media. Medicaid: Average annual growth of 5.6% is projected for Medicaid spending for 2021-2030. National health expenditures, average annual percent change, and percent distribution, by type of expenditure: United States, selected years 1960-2019 . Types of national health expenditures are described as: Business, household, and other private expenditures Outlays for services paid for by nongovernmental sources, such as consumers, private industry, and philanthropic and other nonpatient-care sources. In 2020, per capita personal health care spending ranged from $7,522 in Utah to $14,007 in New York. Medicaid and marketplace enrollment grew by 4.3 million, while commercial coverage declined by 1.7 million. Third Party Payers and Programs and Public Health Activity spending declined 20.7% in 2021 to $596.6 billion, or 14 percent of total NHE. Home / Insights / Blog / CMS Releases National Healthcare Expenditure and Enrollment Projections through 2031. Toll Free Call Center: 1-877-696-6775. The projections for Part B and Part D do not take into account any savings associated with implementation of the. CMS Office of the Actuary Releases 2021-2030 Projections of National Demand for care is expected to remain elevated in 2022, along with a projected acceleration in price growth; as a result, hospital spending growth is likewise expected to accelerate to 6.9% in 2022. This estimate does not include insurers costs of administering private Medicare Advantage and Part D drug plans, which are considerably higher. Top Picks, One Screen, Multi-Screen, and Maps, Industry Finder from the Quarterly Census of Employment and Wages, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData, https://www.cms.gov/files/document/definitions-sources-and-methods.pdf, https://www.census.gov/programs-surveys/sas/about.html, https://www.census.gov/programs-surveys/economic-census/about.html, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/nationalHealthAccountsHistorical.html. The morbidity effect associated with deaths due to COVID-19 is expected to decrease over time and end in 2028. Therefore, the proposed RCT standard not only will help generate evidence on the clinical efficacy of approved antiamyloid mAbs, it will also support the development of future antiamyloid mAbs by not discouraging clinical trial participation. As seen in Chart 1 below, the CE estimates of aggregate annual expenditures of total health care, private health insurance, Medicare Supplementary Insurance Trust Fund, prescription drugs, dental services, and other professional services have historically compared well, with estimates ranging from 65 to 124 percent of those from NHEA. Thus, there is insufficient evidence to conclude that the use of monoclonal antibodies directed against amyloid is reasonable and necessary for the treatment of Alzheimers disease. However, absent CED as a condition of antiamyloid mAb coverage, development of the clinical evidence necessary to show meaningful improvements in health outcomes may proceed slowly and without the appropriate rigor to demonstrate true clinical efficacy, driving increasing costs to the Medicare program as well as individual patients and their families. National Health Expenditure Accounts (NHEA) - Health, United States Spending on these provisions will be offset in part by extending the 2% Medicare payment sequestration, currently set to expire in 2031, partway into fiscal year 2032. The insured . The CE and the NHEA differ in the populations they cover. On behalf of the Council for Informed Drug Spending Analysis (CIDSA), we are writing in support of the Centers for Medicare & Medicaid Services' (CMS') proposed National Coverage Determination . The Office of the Actuary provides annual updates to historical and projected National Health Expenditure data on Medicare, Medicaid, CHIP, and other public insurance programs, as well as commercial healthcare insurance. Now updated with 2021 data, the National Health Spending Explorer on the Peterson-KFF Health System Tracker provides up-to-date information on U.S. health spending by federal and local. Over 2022 and 2023, Medicaid spending growth is expected to slow to 5.7% and 2.7%, respectively, as a result of projected enrollment declines, after the end of the COVID-19 PHE, when the continuous enrollment condition under the Families First Coronavirus Response Act expires and states begin to disenroll beneficiaries no longer eligible for Medicaid. Funding for Medicare, which totaled $888 billion in 2021, comes primarily from general revenues (46%), payroll tax revenues (34%), and premiums paid by beneficiaries (15%). CMS projects 93.6 million Medicaid and CHIP members will account for more than $1.2 trillion in annual spending in 2031 and that 76.4 million Medicare beneficiaries will account for more than $1.8 trillion in expenditures that year. In 2019, CE aggregate medical care expenditures were $678.6 billion or 86 percent of the NHEA estimate of $791.9 billion. KFF Headquarters: 185 Berry St., Suite 2000, San Francisco, CA 94107 | Phone 650-854-9400 The future of health care spending | Deloitte Insights CMS estimated that total Medicaid and CHIP annual spending in 2022 was $828.4 million; by 2031, it is projected to hit $1.2 trillion. MH magazine offers content that sheds light on healthcare leaders complex choices and touch pointsfrom strategy, governance, leadership development and finance to operations, clinical care, and marketing. Therefore, CMS coverage of antiamyloid mAbs under a CED requirement is critical to properly assess whether antiamyloid mAbs are reasonable and necessary for the treatment of Alzheimers Disease, ensuring that Medicare is only paying for truly effective services. A rebound in utilization is expected to primarily influence private health insurance spending growth over 2021 (6.3%) and 2022 (8.3%), and then normalize through 2024. 200 Independence Avenue, S.W. Between 2014 and 2020, average growth in per capita personal health care spending was highest in New York at 6.1 percent per year and lowest in Wisconsin at 3.0 percent per year (compared with average growth of 4.3 percent nationally). While we recognize that neither the cost of antiamyloid mAbs themselves nor their overall spending implications for the Medicare program are a component of CMS reasonable and necessary determination, we believe that an appropriate use of the reasonable and necessary criteria will have an important effect on Medicare spending, patient out-of-pocket costs, and the pricing trends for new antiamyloid mAbs. Healthcare spending will rise by an average of 5.4% a year from 2022 through 2031, when it will reach $7.17 trillion, or 19.6% of gross domestic product. Per person spending for females ($8,811) was 21 percent more than males ($7,272) in 2014. https:// ensures that you are connecting to the official website and that any By 2031, Medicare enrollment is expected to climb to 76.4 million. Similarly, related economic conditions drove a large increase in Medicaid enrollments, which states are winding down. Buthigher projected spending for benefits covered under Part Band Part D will increase the amount of general revenue funding and beneficiary premiums required to cover costs for these parts of the program in the future. We agree with CMS assessment that [t]o date, no trial of an antiamyloid mAb has confidently demonstrated a clinically meaningful improvement in health outcomes (i.e., cognition and function) for AD patients. In 2021, growth in physician and clinical services spending is expected be 5.1%, which is slower than growth of 5.4% in 2020, mainly due to declines in supplemental funding more than offsetting expected utilization increases among Medicare and private health insurance enrollees. For example, the average annual growth rate for Part A was 0.5% between 2010 and 2020, down from 4.5% between 2000 and 2010. (See chart 2.) Data collection begins in January following the survey year and continues for about 28 weeks. Table 1. Projected spending growth of 11.3% in 2021 is expected to be mainly influenced by an assumed acceleration in utilization growth, while growth in 2022 of 7.5% is expected to reflect more moderate growth in use, as well as lower fee-for-service payment rate updates and the phasing in of sequestration cuts. Enrollment is projected to have reached a high of 97.6 million in 2022 and is expected to fall between 2023 and 2026 because of Medicaid redeterminations. The historical and projected estimates of NHE measure total annual U.S. spending for the delivery of health care goods and services by type of good or service (hospital, physician, prescription drugs, etc. In 2021, administrative expenses for traditional Medicare (plus CMS administration and oversight of Part D) totaled $10.8 billion, or 1.3% of total program spending, according to the Medicare Trustees; this includes expenses for the contractors that process claims submitted by beneficiaries in traditional Medicare and their providers. New drugs expected to be approved from 2021-2026 are expected to influence retail prescription drug spending utilization and prices over the remainder of the projection period; over 2025-2030, retail prescription drug spending growth is anticipated to average 5.2%. The NHEA covers the resident population, which includes all persons, both military and civilian, living in the United States. CBO projects that between 2021 and 2032, net Medicare spendingafter subtracting premiums and other offsetting receiptswill grow as a share of both the federal budget, from 10.1% to 17.8%, and the nations economy, from 3.1% to 4.3% of gross domestic product (GDP). If Medicare were to make approved antiamyloid mAbs available outside of an RCT despite the lack of demonstrated clinical efficacy, patients may be discouraged from participating in RCTs for antiamyloid mAbs still in clinical development, as they would have a significant chance of receiving a placebo in the pre-approval RCT but not under Medicare coverage of the approved antiamyloid mAb. We also support CMS proposal not to change the frequency of the single lifetime scan per Medicare beneficiary. authorized by law (including Medicare Advantage Rate Announcements and Advance Notices) or as specifically The NHE report also includes spending on government public health, investment in structures and equipment, and noncommercial research, as well as information on insurance enrollment and uninsured estimates. Chart 1 shows CE estimates of aggregate expenditures for healthcare and CE-NHEA healthcare spending ratios. The National Health Expenditure Accounts (NHEA) measures annual U.S. expenditures for health care goods and services, public health activities, government administration, net cost of health insurance, and investments related to health care. By 2031 the insured share of the population is projected to be 90.5%. In 2031, hospital spending will reach $2.34 trillion dollars, according to the report. Out of pocket spending grew 10.4% to $433.2billion in 2021, or 10percent of total NHE. CMS provides a historical and projected breakdown of expenditures by category for Medicaid only (CHIP is bundled with Department of Defense and other public spending). To sign up for updates or to access your subscriber preferences, please enter your contact information below. NHEA provides estimates of aggregate health care expenditures in the United States from 1960 onward. Hospital spending growth was relatively flat at 6.4% in 2020 compared to 6.3% in 2019, and was driven largely by federal spending. While these scans may provide evidence of changes in beta amyloid plaques, they do not demonstrate evidence of clinically meaningful changes in cognition and function. From 2021 through 2030, private health insurance spending is projected to average 5.7%. In the 1990s and 2000s, Medicare spending per enrollee grew at a similar rate to per enrollee spending among people with private insurance: 5.8% and 5.9%, respectively, in the 1990s and 7.4% and 7.0% in the 2000s. After the end of the COVID-19 PHE, enrollments are projected to begin returning to pre-pandemic distributions. Medicare spending grew 6.4% to $750.2 billion in 2018, or 21 percent of total NHE. Moreover, this standard will ensure that Medicare coverage of a particular approved antiamyloid mAb does not hamper research into additional antiamyloid mAbs, which may eventually drive both therapeutic and price competition that can lower Medicare and patient spending. CMS estimated that the number of insured individuals in the United States was projected to reach a high of 92.3 percent in 2022 and would decrease to 90.5 percent by 2031. Medicare is the federal health insurance program created in 1965 for people ages 65 and over, regardless of income, medical history, or health status. In the NHEA, health care spending is classified by type of establishment. In 2022, 69% of Medicare Advantage enrollees pay no additional premium. Payments to Medicare Advantage plans for Part A and Part B benefits nearly tripled as a share of total Medicare spending between 2011 and 2021, from $124 billion to $361 billion, due to steady enrollment growth in Medicare Advantage plans and higher per person spending in Medicare Advantage than in traditional Medicare.