1. AAMC Contact: Jane Eilbacher Health Care Affairs jeilbacher@aamc.org National Health Expenditures 2009

2. National Health Spending, 2005-2009 National health spending grew 4.0% in 2009, to $2.5 trillion dollars, the slowest recorded rate of growth. Source: CMS, Office of the Actuary, National Health Statistics Group, Table 1, http://www.cms.gov/NationalHealthExpendData/downloads/tables.pdfhttp://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf

3. Health Spending and the GDP Health care spending rose 1 percentage point, to 17.6% of the GDP in 2009, the largest one-year increase in history. This is mainly attributable to a 1.7% decline in the GDP, the largest decline since 1938. Source: CMS, Office of the Actuary, National Health Statistics Group, Table 1, http://www.cms.gov/NationalHealthExpendData/downloads/tables.pdfhttp://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf

4. National Health Expenditures (NHE) by Source of Funds ($ billions) in 2009 Sources: CMS, Office of the Actuary, National Health Statistics Group, Table 3, http://www.cms.gov/NationalHealthExpendData/downloads/tables.pdfhttp://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf Martin, et al. Recession Contributes To Slowest Annual Rate Of Increase In Health Spending In Five Decades. Health Affairs, 30, no.1 (2011): 13 (For Other Third-Party Payers) * * Includes health-related spending for worksite health care, other private revenues, Indian Health Service, workers’ compensation, general assistance, maternal and child health, vocational rehabilitation, other federal programs, Substance Abuse and Mental Health Services Administration, other state and local programs, and school health. Total NHE= $2.5 trillion 12% 11% 6% 32% 20% 15% 4%

5. National Health Spending Average Annual Growth from Prior Year, by Payer Total Medicare spending grew at the same rate in 2009 as in 2008: 7.9%. Rising unemployment contributed to both a decrease in private health insurance spending, as well as an increase in federal Medicaid spending. The disparity in growth between federal and state Medicaid spending is largely due to an increase in the Federal Medicaid Assistance Program (FMAP) under the American Recovery and Reinvestment Act (ARRA). Source: CMS, Office of the Actuary, National Health Statistics Group, Table 3, http://www.cms.gov/NationalHealthExpendData/downloads/tables.pdfhttp://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf

6. Hospital and Physician Payments, as a share of NHE, 2009 Hospital care and physician services accounted for the largest portions of NHE, approximately 31% and 20% respectively. Retail sales of medical products, 13% of NHE, consisted largely of prescription drug sales, which individually represented 10% of NHE ($249.9 billion). Source: CMS, Office of the Actuary, National Health Statistics Group, Table 2, http://www.cms.gov/NationalHealthExpendData/downloads/tables.pdfhttp://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf * *Includes government administration, net cost of health insurance, and government public health activities. Total NHE= $2.5 trillion 20% 7% 5% 3% 5% 13% 10% 6% 31%

7. Hospital and Physician Services, 2005-2009 % Growth from Prior Year Expenditures ($ billions) Hospital care in 2009 grew at nearly the same rate as in 2008. In 2009, physician payments alone increased 3.3%, while clinical services grew 7.3%; in recent years, spending for clinical services has outpaced that for physician services. Source: CMS, Office of the Actuary, National Health Statistics Group, Table 2, http://www.cms.gov/NationalHealthExpendData/downloads/tables.pdfhttp://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf

8.  Health care spending, including hospital and physician spending, has slowed, but still above inflation  Despite slower growth in health care spending, it is consuming an increasing share of GDP  Significant changes to care delivery and payment will be required to both slow payment growth and reset the spending curve Summary