The slower growth reflects a sharp slowdown in the rise of prescription-drug spending, according to the report, noting that health-care spending will be dictated by factors such as the aging of the population, the development of new technology and utilization patterns by patients and doctors.

Other Highlights:

• Health-care spending jumped to 16% of GDP in 2005 from 15.9% in 2004. 

• Federal and state governments share was 40% ($736.3 billion) of spending for health services and supplies. 

• Public-sector spending rose 7.8% in 2005, compared with growth of 7% for businesses and 6.2% for households.

• Prescription-drug spending increased at a lower pace of 5.8% in 2005, down from 8.6% in 2004 and a peak of 18.2% in 1999.

• Drug spending by Medicaid rose 2.8% in 2005, compared with average annual increases of 15.4% for the program from 1994 to 2004. 

• Drug makers increased prices for brand-name prescription medicines an average of 6% in 2005.

• Hospitals accounted for 31% of all dollars spent on health care.

• Nearly 25% of out-of-pocket dollars went to pay for prescription drugs.

• Out-of-pocket spending for health care grew to $249.4 billion in 2005, compared with $235.8 billion in 2004. 

North America posted a 6% growth retail pharmaceutical sales to $204.85 billion in the 12 months to August 2006, according to IMS data.

Read the detailed story at WSJ: Growth in U.S. Health-Care Spending Slows Again

Full Report at Health Affairs