U.S. Healthcare Spending Soars $933 Billion From 1996 and 2013 & Today, Equals 18% of U.S. Economy

U.S. Health Care

U.S. healthcare spending soared by about $933.5 billion between 1996 and 2013. In 2013, healthcare spending hit $2.1 trillion, and today, is likely at $3.2 trillion, which equates to 18% of the entire U.S. economy.

The U.S. now spends more on healthcare than any other country in the world. Even after adjusting for inflation, the annualized growth rate for U.S. healthcare spending between 1995 and 2015 was four percent. Over the same period of time, the U.S. economy advanced just 2.4%.

Researchers from the Institute for Health Metrics and Evaluation in Seattle analyzed how U.S. healthcare spending had changed since the mid-1990s. They collected and analyzed data on 155 health conditions and various types of care.

To compare how much spending has changed, they looked at five influencing factors: population size, aging, disease prevalence, service utilization, and service price and intensity.


According to research published by the Journal of the American Medical Association, the soaring costs of healthcare can be attributed to a number of key factors, including the aging population, rising obesity rates, and increasingly expensive services.

First, and foremost, 50% of the increase ($583.5 billion) can be attributed to rising healthcare costs. By comparison, population growth led to a $269.5-billion (28.8%) increase in total expenditures. The aging population, on the other hand, equaled $135.7 billion of the total.

More is also being spent on specific conditions. Out of the 155 health conditions analyzed, diabetes accounted for the greatest increase in spending. Between 1996 and 2013, spending soared by $64.4 billion, with most of the money going towards pharmaceuticals used to treat it.

Spending on lower back and neck pain increased by $57.2 billion, followed by hypertension ($47.6 billion); hyperlipidemia, or high (“bad”) cholesterol ($41.9 billion); and depressive disorders ($30.8 billion).

Also in the top 10 were falls ($30.4 billion); urinary diseases ($30.2 billion); osteoarthritis ($29.9 billion);sepsis, or bloodstream infection ($26.0 billion); and oral diseases or disorders ($25.3 billion).

As more and more baby boomers retire, the costs associated with these conditions are going to soar.

And while higher spending on healthcare is not necessarily bad, Washington has pointed to countries like Canada and the U.K. as examples of ineffective, costly healthcare systems for years. this shows that there is plenty of room for improvement when it comes to the U.S.’ policies on healthcare.



Factors Associated With Increases in US Health Care Spending, 1996-2013,” Journal of the American Medical Association, November 7, 2017,


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