A Reconciliation of Health Care Expenditures in the National Health Expenditures Accounts and in Gross Domestic Product kenneth.pond Fri, 06/05/2020 - 11:56
Working Paper

This paper provides a detailed reconciliation of the National Health Expenditure Accounts (NHEA), the official estimates of health care spending in the United States from the Centers for Medicare and Medicaid Services, and the estimates of health expenditures that are part of gross domestic product (GDP) produced by the Bureau of Economic Analysis as part of the National Income and Product Accounts. It is an update of the previous reconciliation that was released in 2010. For the period from 2007 to 2018, the estimates of total national health spending in the NHEA and in the GDP data continue to be relatively similar, usually differing by less than 2 percent annually. Well over 90 percent of the total estimated expenditures in the two accounts consist of the same expenditures. However, some specific categories of health care expendi- tures—physician services, hospitals, drugs, health insurance, investment in equipment, and government programs—show proportionately larger differences. These differences reflect the classification and composition of health care spending in the two accounts as well as the use of varied estimation methods and data sources.

 
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Robert Kornfeld , Micah Hartman , Nathan A. Espinosa , Regina L. Butler , and Aaron Catlin

Working Paper ID
WP2020-8
E01 I10
Investment Funds in the U.S. National Accounts tanya.shen Wed, 07/24/2019 - 15:05
Working Paper

Investment funds, which include mutual funds, other regulated investment companies, and real estate investment trusts, play an increasingly important role in the U.S. economy, with financial assets of about $23 trillion in 2017. Currently, in the U.S. National Income and Product Accounts (NIPAs), statistics on investment funds are included within larger aggregate statistics but not published separately. This paper presents separate statistics on investment funds from the NIPAs, using the framework of the integrated macroeconomic accounts, or sectoral accounts. As expected, investment funds account for a significant share of total interest and dividend payments. One feature of BEA’s accounting treatment of investment funds is that they are persistent net borrowers. This paper also discusses possible alternative treatments of investment funds, currently used by the Federal Reserve Board’s Financial Accounts and the national accounts of some other countries, in which net saving and net lending are closer to zero.

 

Robert Kornfeld

Working Paper ID
WP2019-5
Including Illegal Activity in the U.S. National Economic Accounts tanya.shen Tue, 07/09/2019 - 12:27
Working Paper

The internationally agreed guidelines for national economic accounts, System of National Accounts 2008 (hereafter referred to as SNA 2008) (United Nations Statistics Division 2008), explicitly recommend that illegal market activity should be included in the measured economy. This recommendation has not yet been implemented by the U.S. Bureau of Economic Analysis (BEA) because of challenges inherent in identifying suitable source data and differences in conceptual traditions. This paper explores how tracking illegal activity in the U.S. national economic accounts might impact nominal Gross Domestic Product (GDP), real GDP, productivity, and other economic statistics. Nominal GDP rises in 2017 by more than 1 percent when illegal activity is tracked in the U.S. National Income and Product Accounts (NIPAs). By category, illegal drugs add $108 billion to measured nominal GDP in 2017, illegal prostitution adds $10 billion, illegal gambling adds $4 billion, and theft from businesses adds $109 billion. Real GDP and productivity growth also change. Real illegal output grew faster than overall GDP during the 1970s and post–2008. As a result, tracking illegal activity ameliorates both the 1970s economic slowdown and the post–2008 economic slowdown considerably.

 

Rachel Soloveichik

Working Paper ID
WP2019-4