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Is Health Care Back to Pre-Pandemic Normal?

CMS analysis reviews changing trends in health care coverage, spending, usage

December 26, 2023

The public health response to the pandemic dramatically changed health care, with more Americans accessing coverage and dramatic shifts in when people went to the hospital.

A new CMS analysis published this month in Health Affairs reviews the ways COVID-19 changed care and where things stand against the pre-pandemic baseline. Additional federal funding played an important role to support our pandemic response, but the last few years have featured significant volatility in health care.

“Since 2020, health care expenditures have reflected volatile patterns that are primarily linked to the COVID-19 pandemic and the significant response by the federal government to the public health emergency,” the analysis notes.

Here are five takeaways from the report:

  • Coverage gains:  Continuous enrollment in Medicaid led to a record share of insured Americans (92 percent) during 2022.
    • Additional subsidies also contributed to fastest growth in private health insurance since 2015.
    • Employer-sponsored insurance made up 86 percent of all private health plan enrollment.
  • Spending growth:  By 2022, growth in health care spending (4.1%) and the health care sector’s share of the gross domestic product (17.3%) returned to pre-pandemic levels.
  • By insurance:  Private insurance accounted for 29 percent of total health care spending during 2022. Medicare accounted for 21 percent, and Medicaid accounted for 18 percent.
  • Out of pocket costs: Out-of-pocket expenditures made up 11 percent of national health spending, with dental services, durable medical equipment, and physician and clinical services accounting for 34 percent of those costs.
  • Quotable:  “It remains to be seen how future health care spending growth will materialize, as trends are expected to be driven more by health-specific factors such as medical-specific price inflation, the use and intensity of medical care, and demographic impacts associated with the continuing enrollment of the baby-boom generation in Medicare,” the analysis notes.

The full CMS analysis is available online.