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Per capita expenditures of $2,566 in 1990 were almost 1.5 times as great as expenditures 10 years earlier. Personal health care expenditures accounted for 88 percent of that amount, or $2,255 per person.
On a per capita basis health spending has increased in the last five decades, from $353 in 1970 to $13,493. In constant 2022 dollars, the increase was from $2,072 in 1970 to $13,493 in 2022.
Health care costs began rapidly rising in the 1960s as more Americans became insured and the demand for health care services surged. Health care costs have also increased due to preventable diseases, including complications related to nutrition or weight issues.
There are many possible reasons for that increase in healthcare prices: The introduction of new, innovative healthcare technology can lead to better, more expensive procedures and products. The complexity of the U.S. healthcare system can lead to administrative waste in the insurance and provider payment systems.
The prospective payment system (PPS), enacted by Congress in 1983, sought to control hospitalization costs by paying hospitals a fixed rate based on the patients diagnosis during admission (payment was based on diagnosis-related groups) (Social Security Amendments of 1983) (Public Law 98-21).

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Nine reasons for rising healthcare costs Medical providers are paid for quantity, not quality. The U.S. population is becoming more unhealthy. Newer healthcare technology is more expensive. Many Americans dont choose their own healthcare plan. Theres a lack of information about medical care and its costs.
Rising drug, technology, and professional costs, along with an aging population, are major factors contributing to a rise in health care costs. How is health care paid for in the U.S.? Health care in the U.S. is paid for through private insurance, direct payments, and government-funded plans.
Covered California premium increases held below 2% between 2020 and 2022. The federal government extended assistance for two more years, but the 2024 increase reflects post-pandemic inflationary pressures, such as higher drug costs, more people going to see the doctor, labor shortages and wage costs, Altman said.

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