August data reveals health sector economic indicators

A monthly report from Altarum offers insight into the most recent data available on health sector spending, prices, employment and utilization. 

Key data: 

National health spending continues to accelerate 

• In June 2024, national health spending was 7.7% higher than in June 2023 and represented 17.8% of GDP. 

• Nominal GDP in June 2024 was 5.6% higher than in June 2023, growing 2.1 percentage points more slowly than health spending. 

• Personal health care spending growth in June was 8.1%, year over year, with utilization growth continuing to outpace price growth.  

• Growth among major spending categories was highest by far for home health care, at 20.9%, year over year. Spending growth on each of the other major categories was at or below 10%, with spending on physician and clinical services growing the slowest, at 6.6%. 

Health care prices continue to rise faster than economywide inflation 

• The overall Health Care Price Index (HCPI) increased by 2.9% year over year in July, down 0.4 percentage points from a month prior. 

• Economywide inflation fell, with year-over-year growth in the overall Consumer Price Index (CPI) decreasing slightly to 2.9% and growth in the Producer Price Index (PPI) dropping to 2.2%.  

• Among the major health care categories, prices for dental care (5.0%) and nursing home care (4.6%) were the fastest growing, while physician and clinical price growth was the slowest (1.4%). 

• For major payers, year-over-year Medicaid price growth (5.5%) exceeded services price growth for private insurance (3.0%) and Medicare (1.7%) patients. 

• The implicit measure of health care utilization growth was 4.8% year over year in June, equal to the May value. 

• Home health care utilization was, by far, the fastest growing component, increasing 18.5% year over year. This category was followed by prescription drugs (5.9%), nursing care (5.2%), hospital care (4.9%) and physician services (4.9%), while dental services trailed the other categories at 2.0%. 

Health care jobs accounted for nearly half of all jobs added across the economy in July 

• Health care industry employment increased by 55,000 in July 2024, compared to 59,000 jobs in non-health care industries, meaning that health care job growth accounted for 48.2% of all growth. 

• July’s health care job growth was led by growth in ambulatory health care services, which added 26,300 jobs, followed by hospitals, with 19,500 jobs.  

• Nursing and residential care facilities added 9,200 jobs in July, including 6,800 jobs in nursing care facilities and 2,400 jobs in other residential care facilities.  

• The unemployment rate increased from 4.1% in June 2024 to 4.3% in July.  

• In health care and social assistance in June, the job openings rate was 6.7%, the hiring rate was 3.4%, and the total separations rate was 3.0%.  

• Nominal health care wage growth in June 2024 was 3.6% year over year, with growth rates of 4.6% in nursing and residential care facilities, 3.8% in ambulatory health care services, and 3.0% in hospitals.