Healthcare spending in 2006 totaled about $2.1 trillion in 2006, according to figures released Tuesday by the Centers for Medicare & Medicaid Services.
That works out to an average of $7,026 per person in 2006, up from $6,649 per person in 2005.
Hospital spending accounted for 31 percent of total healthcare spending, and grew 7 percent in 2006 compared with 2005. That's down slightly from the 7.3 percent rate of growth in 2005. The decline in 2006 spending was partially driven by lower utilization of hospital services, especially within Medicare, CMS reported.
Spending growth for physician and clinical services also slowed, increasing 5.9 percent in 2006, compared with 7.4 percent growth in spending in 2005.
Overall healthcare spending, as a percentage of the gross domestic product, was 16 percent in 2006, up only a tenth of a percent from the previous year.
However, the growth of healthcare spending in 2006 was up 6.7 percent in 2006, compared with 2005. In 2005, spending was up 6.5 percent compared with 2004. However, the growth in healthcare spending is still far outstripping overall economic growth and the rate of inflation, CMS reported.
Out-of-pocket spending on healthcare grew 3.8 percent in 2006 vs. 2005, compared with 5.2 percent growth in 2005 over the previous year. CMS attributed the decline of the growth of out-of-pocket expenses to the introduction of the Medicare Part D benefit.
Out-of-pocket spending in 2006 accounted for 12 percent of national health spending, continuing an ongoing trend – the percentage of out-of-pocket spending for health was as high as 15 percent in 1998, CMS reported.
Private health plan premiums grew 5.5 percent, which CMS said was the smallest rate of growth since 1997.
Total Medicaid spending declined for the first time since the program's inception, falling 0.9 percent in 2006. CMS said the decline was prompted by the introduction of the Medicare Part D program, cost containment efforts by states and slower enrollment growth because of more restrictive eligibility criteria.
However, the growth in spending on prescription drugs increased for the first time in six years, CMS reported. Spending increased 8.5 percent in 2006, compared with 5.8 percent growth in 2005, primarily because of the effect of Medicare Part D. Total prescription spending in 2006 was $216.7 billion, compared with $199.7 billion in 2005.