FAH Hospital Policy Blog

Perspectives on health policy affecting America's hospitals and the patients we serve.

FAH Policy Blog Team

Hospitals Lead Way Towards ‘History Making’ Price Growth Slowdown

Altarum released its monthly Health Sector Economic Indicators reports today, noting a “history making” ongoing stretch of economy-wide prices growing faster than health care prices. Hospitals led the way in March.

The pricing report found annual year-over-year health care price growth of only 1.2 percent in March 2019, its lowest growth rate since September 2017. Year-over-year hospital price growth also fell to its lowest point since September of 2017, falling from 1.9% in February to 1.6% in March of this year. Private pay hospital price growth “fell sharply” from 2.8 percent in February to 1.7 percent in March.  

 Altarum wonders if “the phenomenon of economy-wide prices growing more quickly than the HCPI (health care pricing index) for 19 months and counting” is indeed a “new normal.”

Regarding spending, Altarum noted that over the past 12 months, expenditures for hospital care grew 2.9% in January 2019, the slowest rate among the major categories, and a key reason why overall national health spending slowed to 4.1 percent – the 16th consecutive month health spending grew less than GDP.

To view the full reports from Altarum click here and here.