The long-term transformation: Healthcare spending from 1850 to 2020

The creation of modern medicine has raised life expectancy in the U.S. from 47 to 78 years during the last century and has caused healthcare spending to grow from 4 percent of gross domestic product to 15 percent, according to an Altarum Institute report.

 Here are five findings on U.S. healthcare spending and medical costs from the report.

1. From 1850 to 1950 health spending rose slowly, with spending not exceeding wages by more than 0.5 percent a year.

2. After 1955, there was a sudden rise in health expenditures, which was due to multiple factors including economic and technological development and a reduction in random mortality due to infectious disease.

3. Excess growth in health spending was more than 3 percent annually during the 1960s and 1970s and then slowed.

4. It is unlikely the excess growth rate will exceed 3 percent for any extended span through 2020. "A reasonable range of projections might be 0.5 percent to 1.5 percent, with an exception that excess spending will eventually be forced down to 0 percent as limits are reached with respect to tax burdens and wage growth," the report states.

5. Through 2020, the bulk of the increase in healthcare spending will likely be centered on those aged 65 and older.

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