Inflation continued to drive up healthcare costs in the US in 2024. Over the next decade, the country’s healthcare spending is projected to substantially increase, driven by the aging population and escalating costs for healthcare services. Even as inflation slows, 2.7% in 2024 compared with the high of 7% in 2021, medical costs continue to rise. Healthcare organizations are dealing with wage inflation as well as higher supply costs, including medical gases. Between 2022 and 2032, US health spending is therefore projected to increase at an average rate of 5.6%, outpacing the average growth rate projected for gross domestic product (GDP). National healthcare expenditures (NHE, in government parlance) grew from 15.7% of GDP in 2019 to 18.9% of GDP in 2024.
Medical care prices and overall health spending is currently outpacing overall economic growth. Using the US consumer price index (CPI), overall prices grew by 3% in June 2024 from the previous year, while prices for medical care increased by 3.3%. Meanwhile, overall prices excluding medical care grew by 2.9%. This marks the first time since early 2021 that medical inflation has grown faster than overall inflation.
The industrial gas market has been integral to the healthcare system, particularly through the pandemic, ensuring hospitals received the therapeutic oxygen required to treat Covid-19 patients as well as other interventions. The industry also supports the design and implementation of medical gas systems that are critical for patient life support. Major industrial gas companies continue to prioritize the supply of oxygen and the essential medical gases to support hospitals and medical professionals by proactively working to understand and meet medical gas supply needs.
Medical gases
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