Financial Performance of the US Healthcare Industry

Financial Performance of the US Healthcare Industry.

The consulting firm McKinsey & Company published a study analyzing the profit of various sectors within the US healthcare industry.

Compound Annual Growth Rate (CAGR) 2019-2024:
Providers (Hospital Systems, Doctors, etc.) 1.8%
Health Insurance -1.2%
Healthcare Services and Technology 8.5%
Pharmacy Services (PBMs, Specialty Pharmacies, etc.) 7.5%

The overall national healthcare expenditures increased 6.1% per year during that same time frame to $5 Trillion.

The lion's share of increased profits have gone to healthcare services, technology and pharmacy services.

It is important to note that the large 'health insurance' conglomerates have wholly-owned subsidiaries that are healthcare services/technology companies (e.g. Change Healthcare, eviCore) and pharmacy services companies (e.g. Optum Rx, Emisar, Express Scripts, Accredo).

It is these 'non-insurance' companies within the health insurance conglomerates that drive all the profit growth for the healthcare industry.

Sources:
McKinsey Report: https://www.mckinsey.com/industries/h...

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