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ABSTRACT Although considerable uncertainty remains, the COVID-19 pandemic and public health emergency are expected to continue to influence the near-term outlook for national health spending and enrollment. National health spending growth is expected to have decelerated from 9.7 percent in 2020 to 4.2 percent in 2021 as federal supplemental funding was expected to decline substantially relative to 2020. Through 2024 health care use is expected to normalize after the declines observed in 2020, health insurance enrollments are assumed to evolve toward their prepandemic distributions, and the remaining federal supplemental funding is expected to wane. Economic growth is expected to outpace health spending growth for much of this period, leading the projected health share of gross domestic product (GDP) to decline from 19.7 percent in 2020 to just over 18 percent over the course of 2022-24. For 2025-30, factors that typically drive changes in health spending and enrollment, such as economic, demographic, and health-specific factors, are again expected to primarily influence trends in the health sector. By 2030 the health spending share of GDP is projected to reach 19.6 percent.
As the COVID-19 pandemic unfolded in 2020, the health sector experienced significant declines in the use of health care services, unprecedented levels offinancial stimulus provided by the federal government, and substantial health insurance enrollment shifts as many people lost employer-sponsored health coverage and sought coverage elsewhere.1 As a result, in 2020 national health expenditures grew at a nearly two-decade high of 9.7 percent, while at the same time nominal gross domestic product (GDP) contracted by 2.2 percent, resulting in the largest observed one-year jump in the share of the economy devoted to health (rising 2.1 percentage points from 2019, to 19.7 percent) (exhibit 1).
In 2021, as the public health emergency continued, new and evolving trends emerged. The federal government continued to provide supplemental funding to health care providers, although at considerably lower levels than in 2020. Surges in COVID-19 cases, hospitalizations, and deaths over the winter were followed by widespread access to vaccinations over the spring and summer. The middle of 2021 saw declining trends in positivity rates, hospitalizations, and deaths, which led to a reemergence of economic and health-sector activity. By the end of the year, however, the emergence of the Delta and...