A structural inflation driver
Healthcare costs are accelerating again, rising 6.1 percent in 2024 and projected to exceed 6.5 percent in 2025—double general inflation. Labor shortages, wage escalation, and pharmaceutical pricing remain key drivers.
Table 1. U.S. Healthcare Cost Indicators
| Metric | 2019 | 2023 | 2025 (f) |
|---|---|---|---|
| Health Expenditure ($ T) | 3.8 | 4.8 | 5.1 |
| Share of GDP (%) | 17.7 | 18.5 | 18.8 |
| Medical CPI (% YoY) | 2.3 | 5.4 | 6.1 |
Sources: CMS, BEA, BLS.
Table 2. Healthcare Workforce Dynamics
| Occupation | Vacancy Rate (%) | Wage Growth (%) |
|---|---|---|
| Nurses | 9.8 | 7.2 |
| Physicians | 6.4 | 5.1 |
| Home Health Aides | 10.2 | 8.5 |
Sources: HHS, AHA, BLS.
Implications for policy and business
Workforce scarcity is forcing hospitals to rely on costly contract labor. Telehealth adoption has plateaued, and consolidation is accelerating as mid-sized providers struggle to manage cost inflation.
Leadership guidance
Health systems must automate administrative functions, redesign care delivery, and scale virtual models. For employers, healthcare cost management will remain the largest structural expense risk through the next decade.