chapter  Chapter 1
26 Pages

The Healthcare Industry: Challenges and Opportunities

ByVincent K. Omachonu

National health expenditure growth is expected to average 5.6 percent annually from 2016 to 2025, according to a report published by Health Affairs and authored by the Centers for Medicare & Medicaid Services’ (CMS) Office of the Actuary (OACT). These projections do not assume potential legislative changes over the projection period. What continues to be shocking to most healthcare observers is the fact that, despite the growth rate, there is no evidence that the overall patient experience has improved. The report also projects the healthcare share of gross domestic product (GDP) to rise from 17.8 percent in 2015 to 19.9 percent by 2025. According to the report, for 2016, total health spending was projected to have reached nearly $3.4 ­trillion, a 4.8 percent increase from 2015. The report also found that, by 2025, federal, state, and local governments are projected to finance 47 percent of national health spending, a slight increase from 46 percent in 2015. The challenges and opportunities facing the healthcare industry include the following: