Global healthcare expenditure to hit US$9.17 trillion by 2020, says MarketLine
Growth will be driven primarily by the US, which dominates the global market and accounts for nearly 50% of total expenditure
Global healthcare expenditure is set to grow from just over US$7.2 trillion in 2015 to around $9.17 trillion by 2020, representing a compound annual growth rate (CAGR) of 5%, according to research firm MarketLine, part of GlobalData.
The company’s latest report, Healthcare Providers Global Industry Guide 2016, states that growth will primarily be driven by the US, which dominates the global market and accounts for nearly 50% of total expenditure. The country also has a forecast CAGR of 4.6%, exceeding that of Europe and Asia-Pacific, indicating that its share of the healthcare market will rise by 2020.
'Strong, stable growth has been felt in the US, and is predicted to continue throughout the forecast period, buoying the global market and offsetting slower growth in Europe and Asia-Pacific (APAC),' said Kate Moody, Analyst for MarketLine.
'The jump in growth since 2014 is primarily explained by the fact that millions of Americans have gained health insurance through the 2010 Affordable Care Act, state Medicaid programmes have been expanded, and the jobs market has been fairly strong recently, which means a higher number of people have health insurance.
'In Europe, the industry’s second largest market, growth will primarily be driven by France, Germany and the UK, which together account for over 50% of European healthcare expenditure,' she added.
MarketLine’s report also states that segment growth differences have been pronounced. Globally, outpatient care is the largest segment, accounting for around 40% of total spending. This is skewed by the large US market, where more than half of expenditure goes towards outpatient care. By comparison, the European outpatient segment is much smaller (26.5%), while inpatient care accounts for the bulk of healthcare expenditure in the region.
'Comparing spending breakdowns between countries and regions offers some distinct differences and priorities,' Moody commented. 'For example, APAC has a large medical goods segment, whereas this segment in Europe, and the US in particular, is noticeably smaller.'
