Summary: Pursuant to a congressional request, GAO reviewed U.S. health care spending trends, focusing on: (1) their effects on business, government, and individuals; (2) factors contributing to rising expenditures; and (3) a comprehensive approach to reform.
GAO found that: (1) in 1990, the United States devoted 12.3 percent of its national income to health care spending, and if the growth trend continues, health care's share of national income could climb to nearly 15 percent in 10 years; (2) the rise in health care spending affected businesses, all levels of government, and individuals, in such areas as employee health care costs and state Medicaid spending; (3) the aging of the population, rise in family incomes, and technological advances in treatments and diagnostic procedures increased both the demand for and cost of care; (4) businesses, state governments, and the federal government individually attempted a wide range of piecemeal cost-containment strategies with limited success; (5) the United States needs to develop a comprehensive strategy that covers the entire spectrum of health care payers and services; and (6) several other industrialized nations successfully implemented policies to control health care spending. GAO also appended a testimony it presented in April 1991 regarding health care costs and long-term strategies for reform of the U.S. health care system.
