Three Health Sector Economic Indicators briefs from the Altarum Institute Center for Sustainable Health Spending provide insights into prices, spending and employment in nursing homes and residential care facilities, home health and other parts of the healthcare sector. The briefs analyze and report data from the U.S. Bureau of Labor Statistics, the Centers for Medicare & Medicaid Services and Macroeconomic Advisers LLC.
Nursing home care price growth was 2.4 percent in February 2015 compared with February 2014, tying dental care, according to the price-related brief (PDF). The highest year-over-year growth, 5.2 percent, was seen in prescription medications. By comparison, the hospital care price change increased from –0.1 percent to 0.4 percent, and physician price growth was nonexistent.
On a 12-month average, per-capita utilization of nursing care is up 1.8 percent, beating only dental care, where utilization has increased by 0.3 percent. By comparison, the utilization rate for hospitals has increased by 3.6 percent; home health, 2.5 percent; physician services, 1.9 percent; and prescription drugs, 6.5 percent.
Although inflation in healthcare and across the economy in general are “extremely low for this stage of the business cycle recovery,” Altarum predicts, based on data analysis, “an increase in healthcare spending that should eventually drive prices higher, for the economy as a whole and for the health sector.”
Nursing home and home health spending combined were $252 billion in February, an amount representing 8 percent of total healthcare spending (nursing care was 5 percent of this amount, and home health was 3 percent), according to the spending brief (PDF). By comparison, hospital spending represented 32 percent of the sector; physician and clinical, 19 percent; other health spending, 16 percent; remaining personal healthcare, 11 percent; and prescription medications, 10 percent.
As far as spending growth over the past 12 months, prescription medications grew most rapidly among the major categories (10.5 percent). Hospital spending grew by 9.0 percent; physician and clinical services grew at the slowest rate, 3.2 percent. Prescription drugs also showed the highest growth among the major categories, at 9.3 percent, for the preceding 12-month period ending in February 2014. During that time, nursing home care increased by the least, 1.3 percent.
Nursing and residential care facilities lost 4,800 jobs in March, making for a 24-month average gain of 2,600 jobs. Job losses in this category declined for the second consecutive month, contributing to a moderate level of overall growth in the health sector.
“The moderation in health sector job growth seen in the past few months is due largely to a downturn in nursing and residential care, which had added 5,000 jobs per month in Q4 2014 but has been flat over Q1 2015,” according to the labor-related brief (PDF).
Home health care gained 6,000 jobs in March, making for a 24-month average gain of 3,600 jobs.
Nursing and residential care facilities offered 22 percent of the jobs in the healthcare sector, and home healthcare services offered 9 percent. (Other categories in the sector: hospitals, 32 percent; physician offices, 17 percent; other ambulatory settings, 15 percent; and outpatient care centers, 5 percent.)