National health expenditures, 1998.

In 1998, national health care expenditures reached $1.1 trillion, an increase of 5.6 percent from the previous year. This marked the fifth consecutive year of spending growth under 6 percent. Underlying the stability of the overall growth, major changes began taking place within the Nation's health care system. Public payers felt the initial effects of the Balanced Budget Act of 1997 (BBA), and private payers experienced increased health care costs and increased premium growth.

Introduction

In this article, we present historical health spending in the United States for the period 1960-1998. The statistics are shown in a matrix structure that describes trends in the size, growth, and distribution of health care expenditures. This matrix represents spending by type of service, such as hospital care and physician services, matched against the sources that pay for the health care bill, including private health insurance (PHI) and government programs such as Medicare and Medicaid. These statistics provide an historical basis for policy-makers, researchers, and the public to understand the trends in spending for the health industry and lay a foundation for projections of health care spending (Smith et al., 1999; Smith et al., 1999).

In the figures that follow, we present information on health care spending, focusing on calendar year 1998. A Technical Note includes a brief summary of the provisions of the BBA that affected national health expenditures (NHE) in 1998. Tables 3-12 following the figures provide detailed NHE information for selected calendar years by type of service and source of funds. More complete time series estimates can be found online at http://www.hcfa.gov/stats/stats.htm.