US health spending growth hits historic low in 2008, but still up 4.4%

In 2008, US health care spending growth dropped to 4.4%, the slowest rate of growth over the past 40 years, according to data from a study published yesterday in the journal Health Affairs based on an analysis by the nation's federal agency, the Centers for Disease Control and Prevention (CMS), part of the US Department of Health and Human Services.

The deceleration was broadly based for nearly all payers and health care goods and services, as growth in both price and non-price factors slowed amid the recession. Despite the slowdown, national health spending reached $2,300 billion, or $7,681 per person, and the health care portion of Gross Domestic Product grew from 15.9% in 2007 to 16.2% in 2008. These developments reflect the general pattern that larger increases in the health spending share of GDP generally occur during or just after periods of economic recession. Despite the overall slowdown in national health spending growth, increases in this spending continue to outpace growth in the resources available to pay for it.

Retail prescription drugs

According to the study, in 2008, retail prescription drug spending growth decelerated to 3.2%, reflecting the continuation of a slowing trend that began in 2000. Additionally, prescription drug spending growth attributable to non-price factors (such as use and intensity) slowed in 2008, as per capita use of prescription drugs declined slightly. Impacts of the recession, a low number of new product introductions, and safety concerns all contributed to lower use per person.