US Healthcare Spending Rose $4 Trillion During 2020 Pandemic
U.S. healthcare spending rose $4 trillion in 2020, marking a 10% jump from the previous year amid the coronavirus pandemic, according to a study by the Office of the Actuary at the Federal Centers for Medicare and Medicaid Services.
“The story that unfolded in 2020 and continues today is unlike anything that has happened in the past 100 years,” according to authors of the study.
The year included 20 million infections and 385,000 deaths from the virus and federal healthcare spending jumped 36% in 2020 compared to 5.9% in 2019. The country’s gross domestic product dropped 2.2%, the largest fall since 1938, and resulted in healthcare spending reaching 20% of the nation’s GDP compared to 17.6% in 2019.
Congress responded to the pandemic by passing legislation that included new funding for healthcare providers, state and local governments, and a boost to the federal portion of Medicaid payments to states. Enrollment in job-based healthcare dropped by 2.3 million and Medicaid enrollment saw an increase of 3.7 million people and the number of uninsured people fell from 31.8 million to 31.2 million.
“The substantial growth in healthcare spending was the largest since 2002 and driven by the unprecedented government response to the global pandemic,” said Micah Hartman, a statistician in the CMS Office of the Actuary.
The U.S. spent nearly twice the amount on healthcare per capita than the average country at $10,948 with the next closest country being Switzerland at $7,138.
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