National home health care spending continues to grow in 2026, though at a slower rate than in recent years, according to a new report from the Centers for Medicare and Medicaid Services (CMS) published in Health Affairs.

Annual growth for home health care is projected to decrease from about 10.3% in 2025 to 7.9% in 2026, according to the report. While home health care makes up a smaller portion of national health care spending at about 3% to 4%, expenditure growth is expected to be strong between 2029 and 2034, the report’s authors wrote. The authors predict home health expenditure will reach $367.8 billion in 2034.

Home health spending is expected to rise 8.1% annually from 2025 to 2034 as the population, especially baby boomers, age.

“Many of those who require more care as they age are increasingly substituting home health care for nursing home and hospital care,” the authors wrote. “With the oldest baby boomers now reaching their eighties, the share of national health expenditures attributable to home health services is expected to rise.”

Health spending overall is expected to outpace the broader economy, according to the study.

National health expenditures are expected to hit 5.4% of average annual growth from 2025 to 2034, while the U.S. gross domestic product could reach 4.1% during that same period.

By 2034, national spending could reach $9 trillion, making up 20.6% of the economy. It made up $5.3 trillion and 18% of the economy in 2024. That’s up from the $8.6 trillion figure projected for 2033 just last year, Home Health Care News previously reported.

“In the near term, the main drivers are high utilization growth across most services, and notably rapid growth in retail prescription drug spending,” study author Jacqueline Fiore said in a Wednesday media briefing.

Medicare is projected to experience the highest spending growth among major sources of funding, reflecting faster spending growth per enrollee and faster enrollment growth, Fiore said.