Spending on home healthcare increased in August by 11.6% year over year, according to Altarum’s monthly Health Sector Economic Indicators brief, released Wednesday.
Most of that increase can be attributed to “utilization growth rather than price increases,” Stephen McCall, senior analyst of health economics and policy at Altarum, told the McKnight’s Business Daily, adding that August marked the fifth successive month in which such rapid growth was observed.
McCall co-authored this month’s brief with Altarum Fellow and Senior Researcher George Miller.
“While home healthcare spending grew the most, this was slightly slower than rates we have seen in recent months for this setting,” McCall added.
Spending growth for nursing home care wasn’t far behind that for home care, growing by 8.6% year over year, according to the brief. By comparison, spending growth for hospital care grew the slowest, at 6%.
Healthcare rates overall increased by 3.1% year over year in September, up 0.3 percentage points over last month’s revised value. Among the major healthcare categories, rates for nursing home care, hospitals and dental care were the fastest-growing, at 4.4%, 3.9% and 3.9%, respectively, whereas home health rate growth was the slowest, at 1.3%, according to McCall.
Personal healthcare spending
Personal healthcare spending overall — that is, spending on healthcare goods and services — grew by 7.4% between August 2023 and August 2024. Spending on healthcare in August 2024 was 7.2% higher than in August 2023, representing 17.5% of the gross domestic product, McCall said.
Nominal GDP grew by 4.7% year over year in August, according to the brief. The GDP grew 2.5 percentage points more slowly than health spending, Altarum noted.
Employment bright spots
In September, healthcare employment increased by 45,200 jobs out of the 208,800 jobs added to the economy overall.
Ambulatory healthcare services led healthcare job growth in September, adding 24,300 jobs, followed by hospitals, with 11,500 jobs, and nursing and residential care settings, with 9,400 jobs.
“In a month of below-average job growth for most healthcare settings, two exceptions were nursing care facilities, which added 3,900 jobs, and home healthcare services, which added 12,700 jobs,” McCall said.
Wage growth at 3.6%
Year-over-year wage growth in the healthcare industry was 3.6% in August, with growth rates of 4.2% in nursing and residential care facilities, 3.6% in ambulatory healthcare services and 3.5% in hospitals.
Wage data for September are not yet available.
