Health Care Spending in 2014 is Likely to Cause an Increase in Medical Costs

In 2010, Americans spent over $2.6 trillion on health care, and in 2014 their spending is at its fastest pace in the first quarter since 1980. The Affordable Care Act is likely responsible as it grants more people access to care.

This is nothing new for the United States. According to National Health Expenditure data, in 2009 the U.S. spent 60% more on hospital care and spent 2.5 times more on physicians, specialists, and dentists compare to other Organization of Economic Cooperation and Development countries. The next closest spenders were Norway, Switzerland, and the Netherlands.

As of 2012, the U.S. health expenditure per capita was $8,895. This number is likely to increase in the next few years as the Affordable Care Act begins to kick in. More Americans are visiting doctors and hospitals now that they are eligible to receive health care and analysts believe that such trends will cause increases in both medical spending and costs.

The Bureau of Economic Analysis recorded a 9.9% increase in health care expenditures during the first quarter of this year, mainly because eight million Americans obtained health insurances through Obamacare. The Health Care Cost Institute surveys the 156 million Americans under the age of 65 with employer-sponsored health insurance. In 2012, the per capita expenditure among these people was $4,701 per person, compared to the $8,895 total for all Americans.

Cancer drugs are also experiencing a sharp increase, and since it's the second leading cause of death in the United States, it's likely Americans are also spending more money on the expensive drugs. In 2012 over 575,000 men and women died of cancer, a number that is also not likely to decrease in the coming years.

The second quarter of this year is likely to witness high health care spending for a few reasons: the Affordable Care Act's sign-up deadline was extended to April 15, faster job growth will lead to more health care spending for those who lacked covered when they were unemployed, and the improving economy could encourage people to spend money on health care.