TITLE:
US National Healthcare Expenditures, 1960-2000: Public and Private Cubic Growth Dynamics
AUTHORS:
Jack E. Riggs, Jeffrey C. Hobbs, Gerald R. Hobbs, Todd H. Riggs
KEYWORDS:
Consumer Price Index; Cubic Dynamics; Economic Modeling; National Healthcare Expenditures; Per Capita Healthcare Expenditures; Population; Private; Public; United States
JOURNAL NAME:
Modern Economy,
Vol.3 No.2,
March
28,
2012
ABSTRACT: US national healthcare expenditures (NHE) displayed cubic growth dynamics between 1960 and 2000. In any year, current NHE must equal population times consumer price index (CPI) times per capita CPI-adjusted constant dollar healthcare expenditures. Cubic growth dynamics are a consequence of the fact that essentially linear growth relationships were observed over time with total population, CPI, and per capita CPI-adjusted dollar healthcare expenditures. Similarly in any year, current private and public NHE must equal population times consumer price index (CPI) times private and public per capita CPI-adjusted constant dollar healthcare expenditures respectively. This study examined whether private and public per capita CPI-adjusted dollar healthcare expenditures displayed linear growth. Linear relationships were observed over this time period for both private per capita CPI-adjusted dollar healthcare expenditures and public per capita CPI-adjusted dollar healthcare expenditures. The finding that both of these factors were well described by linear equations suggests that that both private and public NHE growth should display cubic growth dynamics over time. From 1960 through 2000, cubic growth dynamics were observed for both private NHE and public NHE. This model suggests that shifting healthcare costs between the private and public domains will not alter the underlying cubic growth dynamics of U.S. NHE as long as per capita CPI-adjusted constant dollar private and public healthcare expenditures increase reasonably linearly over time.