Health care costs in the United States have generally grown faster than inflation. The U.S. far exceeds other large and wealthy nations in per capita health spending, and health care represents a much larger share of the economy in the U.S. than in peer nations. Elevated health care expenditure in the U.S., however, does not consistently translate into superior health outcomes. Rising health care costs contribute to many people facing difficulties affording medical care and drugs, even among those with insurance. Despite substantial spending, the U.S. health system grapples with disparities and gaps in coverage.

Many people are familiar with the high and rising cost of health care in the United States from seeing how much they spend on their own health insurance premiums and out-of-pocket costs. In addition to these obvious health costs, there are also tax dollars that go to fund public programs and the amounts employers spend toward their employees’ health insurance premiums. Total national health expenditures include spending by both public programs and private health plans, as well as out-of-pocket health spending. Total health expenditures represent the amount spent on health care (such as doctor visits, hospital stays, and prescription drugs) and related activities (such as insurer overhead and profits, health research and infrastructure, and public health).

Health spending in the U.S. has risen sharply over the last several decades. The official data on national health expenditures from the Centers for Medicare and Medicaid Services (CMS) show health spending totaled $74.1 billion in 1970. By 2000, health expenditures had reached about $1.4 trillion; in 2022, the amount spent on health tripled to $4.5 trillion. In the first year of the COVID-19 pandemic, health spending accelerated by 10.6% in 2020, even as the use of health care dropped, driven largely by public health spending and financial relief provided to health care providers. Health spending grew modestly from 2021 to 2022, by 4.1%, slightly faster than the 3.2% increase from 2020 to 2021.

Read the full article about U.S. health care spending by Cynthia Cox, Jared Ortaliza, Emma Wager, and Krutika Amin at KFF.