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Almost $1.7 Trillion Spent On Health Care in '03

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The USA spent nearly $1.7 trillion on health care last year, although the rate at which spending increased slowed for the first time in years.

A small decrease in medical prices, coupled with less spending by states on Medicaid programs, helped slow the increase, a report published Wednesday by the Centers for Medicare & Medicaid Services says.

National spending grew a projected 7.8% in 2003, down from 9.3% in 2002. Still, the country spent $5,805 per person on health care in 2003, an amount that far exceeds the per capita amount spent in every other industrialized nation.

Health care accounted for 15.3% of the gross domestic product (GDP) last year, the fifth-consecutive year that ''more of the nation's resources (were) allocated to health care,'' according to the report.

Despite the slower rate of growth, the report forecasts spending on health care will continue to outpace growth in GDP through 2013. That means health care costs are likely to rise faster than most people's incomes.

''Each year, there are more people who find they just can't afford health care or insurance,'' says Paul Ginsburg, an economist at the Center for Studying Health System Change, a research group.

The good news for employers and consumers is that growth in health insurance premiums is expected to moderate, slowing to about a 7.1% increase in 2005. The report estimates that premiums rose 10.4% in 2003.

The bad news for many workers is that employers are passing along additional insurance costs, through increased premiums and bigger out-of-pocket charges, which are what patients pay when they visit the doctor or fill a prescription.

Out-of-pocket costs, which went down during the height of the managed-care era, are rising. The forecast says those costs currently eat up about 2.7% of a consumer's disposable personal income, an amount that will rise to 3.1% in 2013.

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© Copyright 2004 USA TODAY, a division of Gannett Co. Inc.

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