Update CMS out-of-pocket per-capita uprater to NHE projections 2025-2034

changelog.d/moop-nhe-2025-2034-refresh.changed.md

@@ -0,0 +1 @@
+Update CMS out-of-pocket health spending per capita, the uprater for health expense inputs, to the NHE projections 2025-2034 release (2018-2034 from Table 3, 2015-2017 from the historical accounts), and extend it from 2034 at the 2033-2034 growth rate instead of hand-extended 2033-2035 values.

policyengine_us/parameters/calibration/gov/hhs/cms/moop_per_capita.yaml

@@ -1,35 +1,51 @@
-description: The Centers for Medicare and Medicaid Services (CMS) projects these per-capita out-of-pocket health payments.
+description: The Centers for Medicare and Medicaid Services (CMS) reports and projects this out-of-pocket health spending per capita.
 metadata:
   unit: currency-USD
-  label: Per-capita MOOP
+  label: CMS out-of-pocket health spending per capita
   reference:
-  # Data underlying figures:
-  # https://www.cms.gov/files/zip/nhe-projections-tables.zip
-  # Table03 National Health Expenditures by Sources of Funds
-  # Retrieved 2025-02-17.
-  - title: NHE Projections
-    href: https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/projected
+  # Table03 National Health Expenditures by Sources of Funds, "Per Capita
+  # Amount" block, "Out-of-Pocket Payments" column: historical estimates for
+  # 2018-2024 and projections for 2025-2034. ZIP Last-Modified 2026-09-03,
+  # sha256 264f822618a5e1829138aea57cc6c8bf45bbaf072a72898fef5547f7ece6cd70,
+  # retrieved 2026-10-11 from
+  # https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/projected
+  - title: CMS National Health Expenditure Projections 2025-2034, Table 3
+    href: https://www.cms.gov/files/zip/nhe-projections-tables.zip
+  # 2015-2017 are before Table03's first year. Each is that year's per-capita
+  # national health expenditures (Table01 of the projections ZIP above) times
+  # out-of-pocket spending's share of national health expenditures (NHE2024.csv
+  # rows "Out of pocket" and "Total National Health Expenditures", millions),
+  # rounded to the dollar. The same rule reproduces every published 2018-2024
+  # value. ZIP Last-Modified 2026-01-13, sha256
+  # b6a9e26774ca36931d42add46204947d6335fc4898011780563196898f964746,
+  # retrieved 2026-10-11 from
+  # https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/historical
+  - title: CMS National Health Expenditures by Type of Service and Source of Funds, Calendar Years 1960-2024
+    href: https://www.cms.gov/files/zip/national-health-expenditures-type-service-source-funds-cy-1960-2024.zip
 values:
-  # Historical.
-  2016-01-01: 1_130
-  2017-01-01: 1_139
-  2018-01-01: 1_181
-  2019-01-01: 1_227
-  2020-01-01: 1_210
-  2021-01-01: 1_341
-  2022-01-01: 1_425
-  # Projections.
-  2023-01-01: 1_528
-  2024-01-01: 1_619
-  2025-01-01: 1_669
-  2026-01-01: 1_720
-  2027-01-01: 1_786
-  2028-01-01: 1_851
-  2029-01-01: 1_917
-  2030-01-01: 1_985
-  2031-01-01: 2_057
-  2032-01-01: 2_131
-  # Applying the same growth rate as 2031-2032.
-  2033-01-01: 2_208 # 2_131 * (2_131 / 2_057)
-  2034-01-01: 2_287 # 2_131 * (2_131 / 2_057)^2
-  2035-01-01: 2_369 # 2_131 * (2_131 / 2_057)^3
+  # Computed from CMS's historical accounts; see the second reference.
+  2015-01-01: 1_119
+  2016-01-01: 1_155
+  2017-01-01: 1_177
+  # Historical Estimates.
+  2018-01-01: 1_223
+  2019-01-01: 1_269
+  2020-01-01: 1_239
+  2021-01-01: 1_372
+  2022-01-01: 1_468
+  2023-01-01: 1_555
+  2024-01-01: 1_632
+  # Projected.
+  2025-01-01: 1_721
+  2026-01-01: 1_826
+  2027-01-01: 1_892
+  2028-01-01: 1_974
+  2029-01-01: 2_053
+  2030-01-01: 2_139
+  2031-01-01: 2_223
+  2032-01-01: 2_314
+  2033-01-01: 2_412
+  2034-01-01: 2_512
+  # 2035 to 2100 grow at the 2033-2034 rate (2_512 / 2_412, 4.1% a year)
+  # and later years hold the 2100 value; see set_all_uprating_parameters in
+  # uprating_extensions.py.

policyengine_us/parameters/uprating_extensions.py

@@ -955,10 +955,12 @@ def set_all_uprating_parameters(parameters: ParameterNode) -> ParameterNode:
     )
 
     # CMS per-capita out-of-pocket medical spending (January values, last
-    # projection year 2035). Health expense inputs use this as their uprater.
+    # projection year 2034). Health expense inputs use this as their uprater.
+    # Each year from 2035 to 2100 grows at CMS's 2033-2034 rate, and later
+    # years hold the 2100 value.
     extend_parameter_values(
         parameters.calibration.gov.hhs.cms.moop_per_capita,
-        last_projected_year=2035,
+        last_projected_year=2034,
         end_year=END_YEAR,
         period_month=1,
         period_day=1,

policyengine_us/tests/core/test_cms_moop_uprating.py

@@ -0,0 +1,268 @@
+"""The CMS out-of-pocket health spending per capita series that health
+expense inputs uprate by.
+
+CMS's National Health Expenditure (NHE) projections (Table 3, 2025-2034
+release) report out-of-pocket spending per capita for 2018 to 2034: historical
+estimates through 2024 and projections from 2025. The parameter holds that
+column. 2015 to 2017 come from CMS's historical accounts by the rule that
+reproduces Table 3's 2018-2024 values, and 2035 to 2100 grow at the 2033-2034
+rate.
+
+These tests read only the parameter tree and the parameter's YAML file.
+
+Invariants:
+
+1. Transcription: every 2018-2034 value is Table 3's published dollar figure,
+   and is consistent with the same release's out-of-pocket and national
+   health expenditure aggregates (Table 3) and per-capita national health
+   expenditures (Table 1) within rounding.
+2. Historical rule: for 2015 to 2024, the value is per-capita national health
+   expenditures times out-of-pocket spending's share of national health
+   expenditures in the historical accounts, rounded to the dollar. For
+   2018-2024 that reproduces Table 3, which is what licenses the rule for
+   2015-2017. The historical accounts and the projections share their
+   historical years, so the two sources are one vintage.
+3. Markers: the YAML marks 2018-2024 as historical estimates and 2025-2034 as
+   projected, as Table 3 does, and has no hand-extended years after 2034.
+4. Bounds and order: the series is positive in every year. It is strictly
+   increasing over 2015-2019 and 2020-2100; its one decline, 2019 to 2020
+   (1,269 to 1,239), is CMS's and is intended.
+5. Extension rule: each year from 2035 to 2100 grows by 2,512 / 2,412, so the
+   value equals the closed form 2,512 * (2,512 / 2,412) ** (year - 2034); later
+   years hold the 2100 value.
+"""
+
+import math
+from pathlib import Path
+
+import pytest
+import yaml
+from hypothesis import given
+from hypothesis import strategies as st
+from policyengine_core.parameters.operations.get_parameter import get_parameter
+
+from policyengine_us.system import system
+
+MOOP = "calibration.gov.hhs.cms.moop_per_capita"
+YAML_PATH = (
+    Path(__file__).parents[2]
+    / "parameters"
+    / "calibration"
+    / "gov"
+    / "hhs"
+    / "cms"
+    / "moop_per_capita.yaml"
+)
+FIRST_YEAR, FIRST_TABLE_YEAR, FIRST_PROJECTED_YEAR = 2015, 2018, 2025
+LAST_PROJECTED_YEAR, END_YEAR = 2034, 2100
+TABLE_YEARS = range(FIRST_TABLE_YEAR, LAST_PROJECTED_YEAR + 1)
+ACCOUNT_YEARS = range(FIRST_YEAR, FIRST_PROJECTED_YEAR)
+# Health expense inputs that uprate by this series, as listed in
+# docs-quarto/methodology/spm-poverty.qmd. Pre-tax health insurance premiums
+# also use it today; PR #10083 moves them to the ESI premium series, so they
+# are left out here. HSA payroll contributions follow the family HSA
+# contribution limit since #10097.
+HEALTH_INPUTS = {
+    "ambulance_expense",
+    "er_visit_expense",
+    "health_insurance_premiums",
+    "health_insurance_premiums_without_medicare_part_b",
+    "imaging_expense",
+    "inpatient_expense",
+    "lab_expense",
+    "long_term_health_insurance_premiums",
+    "medicare_part_b_premiums_reported",
+    "other_health_insurance_premiums",
+    "other_medical_expenses",
+    "outpatient_expense",
+    "over_the_counter_health_expenses",
+    "physician_services_expense",
+    "prescription_expense",
+    "urgent_care_expense",
+}
+
+# CMS NHE projections tables
+# (https://www.cms.gov/files/zip/nhe-projections-tables.zip, Last-Modified
+# 2026-09-03, sha256 264f8226...cd70).
+# Table 3, "Per Capita Amount" block, "Out-of-Pocket Payments" column.
+OOP_PER_CAPITA = dict(
+    zip(
+        TABLE_YEARS,
+        (
+            *(1_223, 1_269, 1_239, 1_372, 1_468, 1_555, 1_632),
+            *(1_721, 1_826, 1_892, 1_974, 2_053, 2_139, 2_223, 2_314),
+            *(2_412, 2_512),
+        ),
+    )
+)
+# Table 3, "Amount in Billions" block, "Out-of-Pocket Payments" and "Total".
+OOP_BILLIONS = dict(
+    zip(
+        TABLE_YEARS,
+        (
+            *(403.0, 420.4, 412.3, 457.2, 491.9, 525.4, 556.6, 591.1, 627.9),
+            *(651.8, 681.1, 710.0, 742.1, 773.6, 808.0, 845.1, 883.2),
+        ),
+    )
+)
+NHE_BILLIONS = dict(
+    zip(
+        TABLE_YEARS,
+        (
+            *(3637.7, 3805.1, 4204.3, 4376.9, 4586.6, 4925.3, 5278.6),
+            *(5661.7, 6017.4, 6301.6, 6627.1, 6966.6, 7316.0, 7689.0),
+            *(8074.7, 8510.9, 8970.3),
+        ),
+    )
+)
+# Table 1, "Per Capita Amount" block, "National Health Expenditures" row.
+NHE_PER_CAPITA = dict(
+    zip(
+        range(FIRST_YEAR, LAST_PROJECTED_YEAR + 1),
+        (
+            *(9_860, 10_229, 10_582, 11_042, 11_487, 12_637, 13_137),
+            *(13_689, 14_580, 15_474, 16_486, 17_496, 18_295, 19_204),
+            *(20_141, 21_092, 22_095, 23_124, 24_289, 25_513),
+        ),
+    )
+)
+# CMS historical accounts, NHE2024.csv rows "Out of pocket" and "Total
+# National Health Expenditures", millions
+# (https://www.cms.gov/files/zip/national-health-expenditures-type-service-source-funds-cy-1960-2024.zip,
+# Last-Modified 2026-01-13, sha256 b6a9e267...4746).
+OOP_MILLIONS = dict(
+    zip(
+        ACCOUNT_YEARS,
+        (
+            *(360_681, 375_394, 385_333, 403_033, 420_412, 412_276),
+            *(457_160, 491_924, 525_424, 556_554),
+        ),
+    )
+)
+NHE_MILLIONS = dict(
+    zip(
+        ACCOUNT_YEARS,
+        (
+            *(3_177_216, 3_324_095, 3_464_208, 3_637_678, 3_805_121),
+            *(4_204_311, 4_376_932, 4_586_625, 4_925_324, 5_278_588),
+        ),
+    )
+)
+EXTENSION_GROWTH = 2_512 / 2_412
+
+
+def _index(year):
+    return get_parameter(system.parameters, MOOP)(f"{year}-01-01")
+
+
+def _round_half_up(value):
+    return math.floor(value + 0.5)
+
+
+def _historical_rule(year, per_capita_nhe=None):
+    per_capita_nhe = NHE_PER_CAPITA[year] if per_capita_nhe is None else per_capita_nhe
+    return per_capita_nhe * OOP_MILLIONS[year] / NHE_MILLIONS[year]
+
+
+@pytest.mark.parametrize("year", TABLE_YEARS)
+def test_index_is_table_3_out_of_pocket_per_capita(year):
+    assert _index(year) == OOP_PER_CAPITA[year]
+
+
+@pytest.mark.parametrize("year", TABLE_YEARS)
+def test_published_values_match_aggregates_and_per_capita_nhe(year):
+    """Checks three independently transcribed rows for consistency within
+    publication rounding. A mistyped figure fails unless it stays inside that
+    tolerance (883.3 for 2034's 883.2 would pass)."""
+    # The aggregates are rounded to $0.1 billion, per-capita NHE to the
+    # dollar, and the published value to the dollar.
+    low = (NHE_PER_CAPITA[year] - 0.5) * (OOP_BILLIONS[year] - 0.05)
+    low = low / (NHE_BILLIONS[year] + 0.05) - 0.5
+    high = (NHE_PER_CAPITA[year] + 0.5) * (OOP_BILLIONS[year] + 0.05)
+    high = high / (NHE_BILLIONS[year] - 0.05) + 0.5
+    assert low <= OOP_PER_CAPITA[year] <= high
+
+
+@pytest.mark.parametrize("year", range(FIRST_TABLE_YEAR, FIRST_PROJECTED_YEAR))
+def test_historical_accounts_share_the_projections_historical_years(year):
+    assert OOP_MILLIONS[year] / 1_000 == pytest.approx(OOP_BILLIONS[year], abs=0.05)
+    assert NHE_MILLIONS[year] / 1_000 == pytest.approx(NHE_BILLIONS[year], abs=0.05)
+
+
+@pytest.mark.parametrize("year", ACCOUNT_YEARS)
+def test_values_through_2024_follow_the_historical_rule(year):
+    computed = _historical_rule(year)
+    assert _index(year) == _round_half_up(computed)
+    if year >= FIRST_TABLE_YEAR:
+        assert _round_half_up(computed) == OOP_PER_CAPITA[year]
+    else:
+        # For the derived years, per-capita NHE is rounded to the dollar and
+        # the result rounds to the same dollar anywhere in that range. (Not
+        # so for 2024, whose range straddles 1,631.5; Table 3 settles it.)
+        low = _historical_rule(year, NHE_PER_CAPITA[year] - 0.5)
+        high = _historical_rule(year, NHE_PER_CAPITA[year] + 0.5)
+        assert _round_half_up(low) == _round_half_up(high)
+
+
+def test_yaml_marks_historical_and_projected_years_as_table_3_does():
+    lines = YAML_PATH.read_text().splitlines()
+
+    def comment_before(date):
+        index = next(
+            i for i, line in enumerate(lines) if line.strip().startswith(f"{date}:")
+        )
+        return lines[index - 1].strip()
+
+    assert comment_before(f"{FIRST_TABLE_YEAR}-01-01") == "# Historical Estimates."
+    assert comment_before(f"{FIRST_PROJECTED_YEAR}-01-01") == "# Projected."
+
+    values = yaml.safe_load(YAML_PATH.read_text())["values"]
+    years = sorted(date.year for date in values)
+    assert years == list(range(FIRST_YEAR, LAST_PROJECTED_YEAR + 1))
+
+
+@given(st.integers(FIRST_YEAR, END_YEAR + 100))
+def test_index_is_positive(year):
+    assert _index(year) > 0
+
+
+@given(
+    st.sampled_from([(FIRST_YEAR, 2019), (2020, END_YEAR)]),
+    st.integers(0, END_YEAR - FIRST_YEAR),
+    st.integers(1, END_YEAR - FIRST_YEAR),
+)
+def test_index_is_strictly_increasing_where_cms_is(segment, offset, gap):
+    start, end = segment
+    year = start + offset % (end - start)
+    later = min(year + gap, end)
+    assert _index(year) < _index(later)
+
+
+def test_the_only_decline_is_cms_2019_to_2020():
+    declines = [
+        year
+        for year in range(FIRST_YEAR + 1, END_YEAR + 1)
+        if _index(year) < _index(year - 1)
+    ]
+    assert declines == [2020]
+    assert (_index(2019), _index(2020)) == (1_269, 1_239)
+
+
+@given(st.integers(LAST_PROJECTED_YEAR + 1, END_YEAR))
+def test_extension_holds_the_last_projected_growth_rate(year):
+    growth = _index(year) / _index(year - 1)
+    assert growth == pytest.approx(EXTENSION_GROWTH, rel=1e-12)
+    closed_form = 2_512 * EXTENSION_GROWTH ** (year - LAST_PROJECTED_YEAR)
+    assert _index(year) == pytest.approx(closed_form, rel=1e-12)
+
+
+@given(st.integers(END_YEAR, END_YEAR + 200))
+def test_index_holds_the_2100_value_after_2100(year):
+    assert _index(year) == _index(END_YEAR)
+
+
+def test_health_inputs_uprate_by_the_cms_series():
+    users = {
+        name for name, variable in system.variables.items() if variable.uprating == MOOP
+    }
+    assert users - {"pre_tax_health_insurance_premiums"} == HEALTH_INPUTS

policyengine_us/tests/policy/baseline/parameters/test_uprating_extensions.py

@@ -136,11 +136,17 @@ def test_social_security_benefit_inputs_use_gross_benefit_uprater():
 
 
 def test_cms_moop_per_capita_extends_to_2100():
-    """Health expense input upraters should not flatten after 2035."""
+    """Health expense input upraters keep growing after CMS's 2034
+    projection, at the 2033-2034 growth rate, then hold the 2100 value."""
     parameter = PARAMETERS.calibration.gov.hhs.cms.moop_per_capita
+    last_growth = parameter("2034-01-01") / parameter("2033-01-01")
 
-    assert parameter("2036-01-01") > parameter("2035-01-01")
-    assert parameter("2100-01-01") > parameter("2036-01-01")
+    assert parameter("2034-01-01") == 2_512
+    assert last_growth == pytest.approx(2_512 / 2_412, rel=1e-12)
+    for year in [2035, 2036, 2050, 2100]:
+        growth = parameter(f"{year}-01-01") / parameter(f"{year - 1}-01-01")
+        assert growth == pytest.approx(last_growth, rel=1e-12)
+    assert parameter("2150-01-01") == parameter("2100-01-01")
 
 
 def test_cms_esi_premium_per_enrollee_holds_last_projected_growth_rate():