“July’s growth in health spending on nursing home care and home healthcare remained faster than the broader health spending trends,” Corwin (Corey) Rhyan, research director of health economics and policy at Altarum, told the McKnight’s Business Daily on Tuesday.
“Compared to a year prior, spending on nursing home care was up 8.4% and spending on home healthcare was up 11.6%,” he added, citing Altarum’s monthly Health Sector Economics Index.
Nursing home and home healthcare spending rates in July both were above the average year-over-year increase in total health spending of 5.7%. Overall health spending now represents 17.4% of gross domestic product.
Growth in the overall healthcare price index decreased to 2.8% year over year in August, falling 0.1 percentage points from the slightly revised growth rate in July (2.9%), according to Altarum.
Hiring also showed signs of picking up in skilled nursing / residential care and home healthcare settings.
“Nursing home and residential care employment increased by 5.1% year-over-year in August, while home healthcare services employment increased by 6.5% year-over-year,” Rhyan said. “That being said, even with recent increases, overall employment in nursing home and residential settings remains 5.7% below the total seen before the start of the pandemic in 2020.”
Overall, according to Altarum, the healthcare sector showed the greatest two-month growth since the pandemic began.
“Healthcare added 70,900 jobs in August 2023. With a significant upward revision to July’s job growth, the two-month increase of 143,900 is the largest since the initial recovery from the COVID-induced recession,” the Altarum report noted.
Healthcare wage growth in July was 3.3% year over year, which was a bit lower than the total private sector wage growth of 4.4%. Altarum noted that wage growth in the healthcare sector was highest in nursing and residential care, at 4.3% year over year in July.