West Health warns U.S. health spending is nearing one-fifth of GDP

By AI, Created 8:16 PM UTC, June 01, 2026, /AGP/ – West Health says U.S. healthcare costs are rising faster than the economy and could reach 20.3% of total output by 2033. The nonprofit’s new analysis argues the trend is squeezing families now and calls for sweeping reform in how care is priced, paid for and delivered.

Why it matters: - U.S. healthcare spending is projected to keep growing faster than GDP through 2033, raising the share of the economy devoted to care to about 20.3% from 17.6% in 2023. - West Health says the trend is increasing financial pressure on families already facing higher premiums, more out-of-pocket costs and growing medical debt risk. - The analysis frames the issue as a systemwide affordability problem, not just a household budgeting problem.

What happened: - West Health, a nonpartisan nonprofit focused on healthcare and aging, published an analysis titled “The Rising Burden of U.S. Healthcare Costs.” - The report tracks the accelerating pace of national health expenditures and the strain those costs place on American households. - The resource is available on the West Health Mosaic website.

The details: - National Health Expenditures rose an estimated 8.2% in 2024 and 7.1% in 2025. - West Health projects spending will continue to outpace GDP growth through 2033. - Hospital care accounts for 31% of total spending. - Physician and clinical services account for 20%. - Other services, including dental and public health, account for 27%. - Prescription drugs account for 9%. - Administrative costs account for 8%. - Nursing care and home health account for 5%. - Public sources fund 48% of spending, including Medicare, Medicaid, CHIP and VA programs. - Private sources fund 52%, including employer-sponsored insurance and out-of-pocket payments. - Spending increases substantially with age, adding pressure as the U.S. population gets older. - In 2024, the average annual premium for employer-sponsored family health insurance exceeded $25,000. - Employees contributed roughly $6,296 on average toward those family premiums. - Many families delayed or skipped care because of financial concerns. - A West Health–Gallup poll found 58% of Americans worry a major health event could lead to personal medical debt. - The same poll found 31 million people borrowed an estimated $74 billion in the past year to cover healthcare costs for themselves or a household member.

Between the lines: - West Health is signaling that the cost problem is broad-based: hospital prices, physician services, prescriptions, administration and long-term care all contribute. - The age-related spending pattern suggests the affordability challenge will intensify as the population ages and demand for cost-effective care rises. - The report’s policy focus on transparency, administrative simplification and payment reform points to structural fixes rather than short-term relief.

What’s next: - West Health says reversing the trend will require coordinated action across the healthcare system. - The nonprofit is pushing greater cost transparency, lower administrative burden and fundamental reform in how services and pharmaceuticals are paid for. - The analysis is positioned as a call for policymakers, payers and providers to act before healthcare takes an even larger share of the economy.

The bottom line: - U.S. healthcare costs are rising faster than wages and economic output, and West Health says the pressure is already hitting families while the long-term fiscal burden keeps climbing.