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Uncompensated Hospital Care in
Oregon |
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What is Uncompensated Care?
Uncompensated care is the total amount of health
care services, based on full established charges,
provided to patients who are either unable or
unwilling to pay. Uncompensated care includes
both charity care and bad debt, both described
in more detail below. |
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Definition of Charity Care
The dollar amount of free care, based on a hospital's
full established rates, provided to patients who
are determined by the hospital to be unable to
pay their bill. The determination of a patient's
ability to pay is based on the hospital's charity
care policy. Hospitals will typically determine
a patient's inability to pay by examining a variety
of factors such as individual and family income,
assets, employment status or availability of alternative
sources of funds. Determination of charity care
status is usually made prior to admission, especially
if the patient has requested and applied for financial
assistance. Charity care status may be granted
at a later date depending on the circumstances
of the admission, such as an emergency admission,
or lack of information about the patient's financial
status at the time of admission. Financial assistance
provided by the hospital may pertain to all or
just a portion of the patient's bill.
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Definition of Bad Debt
Bad debt is the unpaid obligation for care, based
on a hospital's full established rates, for patient's
who are unwilling to pay their bill. Unlike charity
care, bad debt arises in situations where the
patient has either not requested financial assistance
or does not qualify for financial assistance.
In these cases the hospital will generate a bill
for services provided. For uninsured patients,
the amount of bad debt can pertain to all or any
portion of the bill that is not paid. For patients
with insurance, certain amounts that are the patient's
responsibilty -- such as deductibles and coinsurance
-- are expensed as bad debt if not paid.
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Why is Uncompensated Care Important?
Uncompensated care is important because costs
incurred by hospitals in providing this care eventually
must be paid by someone. Hospitals are forced
to shift these costs to other payers -- typically
private insurance companies. This is referred
to as the "cost shift".
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How Does Uncompensated Care Affect You?
Uncompensated care and inadequate reimbursement
by government insurance programs like Medicare
and Medicaid end up affecting everyone because
they contribute to the increase in the overall
cost of health care. Costs incurred treating patients
that are not reimbursed end up getting shifted
to private insurers. This is known as the cost
shift and is one of the contributing factors to
annual increases in health care costs that are
typically greater than general inflation. When
hospitals are forced to raise their rates to cover
unpaid costs, private insurers must raise their
rates. Since most private health insurance is
paid by employers, business ends up paying the
bill. As the health care bill continues to rise
businesses are forced to either reduce benefits
to employees or require their employees to pay
for a greater portion of their monthly premium.
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Trends in Uncompensated Care
Since most uncompensated care is generated from
low income patients and the unemployed, the amount
of uncompensated care provided is greatly affected
by the health of the economy and the level of
state Medicaid funding. In general, the more low
income patients who have hospital coverage provided
by Medicaid the lower the level of uncompensated
care. The following charts and graphs track uncompensated
care levels in Oregon from 1994 to present. One
can clearly see the association between levels
of Medicaid funding and levels of uncompensated
care. Declining levels of uncompensated care from
1994 through 1999 were do to increased coverage
to Oregonians provided by the Oregon Health Plan.
Due to state budgetary problems begining in 2001,
cutbacks in Medicaid have resulted in increasing
levels of uncompensated care.
The following data was compiled from the Oregon
DATABANK Program to track levels of uncompensated
care by both year and by calendar quarter. Data
has been aggregated in a variety of ways to look
at uncompensated care levels statewide, in the
Portland Metro area, by type A and B rural hospitals,
and by "DRG" hospitals. Type A and B rural hospitals
are paid by the state Medicaid agency on a "cost"
basis. Reimbursement to DRG hospitals is determined
by a rate based on the DRG or "diagnosis related
group." This is the same payment methodology used
by the Centers for Medicare & Medicaid Services
for Medicare patients. The highest levels of uncompensated
care are found in urban areas - the Portand Metro
area in particular. Since most DRG hospitals are
located in urban areas they also experience the
highest levels of uncompensated care.
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Statewide Uncompensated Care
by Year: |
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Year |
Charity Care |
% Change from Prev. Year |
Bad Debt |
% Change from Prev. Year |
Total Uncomp. Care |
% Change from Prev. Year |
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1994 |
74,653,735 |
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90,272,616 |
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164,926,351 |
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1995 |
55,645,120 |
-25.5% |
90,262,052 |
0.0% |
145,907,172 |
-11.5% |
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1996 |
53,036,784 |
-4.7% |
80,387,137 |
-10.9% |
133,423,921 |
-8.6% |
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1997 |
55,123,781 |
3.9% |
83,974,361 |
4.5% |
139,098,142 |
4.3% |
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1998 |
58,291,332 |
5.7% |
96,289,876 |
14.7% |
154,581,208 |
11.1% |
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1999 |
53,994,527 |
-7.4% |
102,732,393 |
6.7% |
156,726,920 |
1.4% |
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2000 |
64,916,584 |
20.2% |
128,914,104 |
25.5% |
193,830,688 |
23.7% |
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2001 |
77,772,655 |
19.8% |
138,822,832 |
7.7% |
216,595,487 |
11.7% |
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2002 |
107,854,204 |
38.7% |
164,629,911 |
18.6% |
272,484,115 |
25.8% |
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2003 |
183,626,444 |
70.3% |
221,580,947 |
34.6% |
405,207,391 |
48.7% |
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2004 |
268,333,010 |
46.1% |
269,741,864 |
21.7% |
538,074,874 |
32.8% |
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2005 |
374,330,244 |
39.5% |
301,574,208 |
11.8% |
675,904,452 |
25.6% |
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2006 |
445,884,426 |
19.1% |
305,343,908 |
1.3% |
751,228,334 |
11.1% |
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2007 |
524,707,945 |
17.7% |
351,866,447 |
15.2% |
876,574,392 |
16.7% |
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Statewide Uncompensated Care
by Quarter: |
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Quarter |
Charity Care |
% Change from Prev. Quarter |
Bad Debt |
% Change From Prev. Quarter |
Total Uncomp. Care |
% Change from Prev. Quarter |
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2002(1) |
20,351,728 |
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36,986,286 |
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57,338,014 |
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2002(2) |
30,293,989 |
48.9% |
37,486,530 |
1.4% |
67,780,519 |
18.2% |
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2002(3) |
24,096,789 |
-20.5% |
45,102,622 |
20.3% |
69,199,411 |
2.1% |
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2002(4) |
33,111,698 |
37.4% |
45,054,473 |
-0.1% |
78,166,171 |
13.0% |
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2003(1) |
26,666,309 |
-19.5% |
41,745,883 |
-7.3% |
68,412,192 |
-12.5% |
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2003(2) |
53,525,629 |
100.7% |
54,563,058 |
30.7% |
108,088,687 |
58.0% |
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2003(3) |
48,656,777 |
-9.1% |
63,794,367 |
16.9% |
112,451,144 |
4.0% |
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2003(4) |
54,925,440 |
12.9% |
65,263,889 |
2.3% |
120,189,329 |
6.9% |
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2004(1) |
53,731,423 |
-2.2% |
64,516,256 |
-1.1% |
118,247,679 |
-1.6% |
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2004(2) |
63,046,998 |
17.3% |
56,860,007 |
-11.9% |
119,907,005 |
1.4% |
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2004(3) |
71,631,250 |
13.6% |
78,226,358 |
37.6% |
149,857,608 |
25.0% |
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2004(4) |
79,923,339 |
11.6% |
70,139,243 |
-10.3% |
150,062,582 |
0.1% |
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2005(1) |
84,587,288 |
6.4% |
71,920,587 |
1.9% |
156,507,875 |
4.2% |
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2005(2) |
96,676,021 |
14.3% |
71,596,201 |
-0.5% |
168,272,222 |
7.5% |
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2005(3) |
90,061,899 |
-6.8% |
87,180,985 |
21.8% |
177,242,884 |
5.3% |
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2005(4) |
102,348,194 |
13.6% |
71,594,580 |
-17.9% |
173,942,774 |
-1.9% |
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2006(1) |
119,554,054 |
16.8% |
54,183,753 |
-24.3% |
173,737,807 |
-0.1% |
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2006(2) |
101,210,052 |
-15.3% |
85,662,561 |
58.1% |
186,872,613 |
7.6% |
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2006(3) |
105,725,422 |
4.5% |
84,378,679 |
-1.5% |
190,104,101 |
1.7% |
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2006(4) |
119,394,898 |
12.9% |
81,223,675 |
-3.7% |
200,618,573 |
5.5% |
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2007(1) |
126,719,060 |
6.1% |
74,111,441 |
-8.8% |
200,830,501 |
0.1% |
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2007(2) |
128,215,832 |
1.2% |
82,676,101 |
11.6% |
210,891,933 |
5.0% |
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2007(3) |
128,714,907 |
0.4% |
96,305,844 |
16.5% |
225,020,751 |
6.7% |
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2007(4) |
141,058,146 |
9.6% |
98,773,061 |
2.6% |
239,831,207 |
6.6% |
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Portland Metro Uncompensated
Care By Year: |
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Year |
Charity Care |
% Change from Prev. Year |
Bad Debt |
% Change from Prev. Year |
Total Uncomp. Care |
% Change from Prev. Year |
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1994 |
49,898,398 |
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39,911,234 |
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89,809,632 |
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1995 |
35,048,213 |
-29.8% |
42,334,003 |
6.1% |
77,382,216 |
-13.8% |
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1996 |
30,534,899 |
-12.9% |
39,155,046 |
-7.5% |
69,689,945 |
-9.9% |
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1997 |
30,130,369 |
-1.3% |
41,744,589 |
6.6% |
71,874,958 |
3.1% |
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1998 |
35,059,007 |
16.4% |
46,284,977 |
10.9% |
81,343,984 |
13.2% |
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1999 |
32,615,512 |
-7.0% |
50,921,097 |
10.0% |
83,536,609 |
2.7% |
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2000 |
37,742,974 |
15.7% |
60,403,132 |
18.6% |
98,146,106 |
17.5% |
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2001 |
43,746,850 |
15.9% |
67,989,566 |
12.6% |
111,736,416 |
13.8% |
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2002 |
63,472,771 |
45.1% |
82,979,621 |
22.0% |
146,452,392 |
31.1% |
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2003 |
113,160,179 |
78.3% |
102,598,743 |
23.6% |
215,758,922 |
47.3% |
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2004 |
152,301,766 |
34.6% |
114,277,755 |
11.4% |
266,579,521 |
23.6% |
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2005 |
203,420,810 |
33.6% |
124,563,875 |
9.0% |
327,984,685 |
23.0% |
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2006 |
252,128,825 |
23.9% |
103,201,103 |
-17.2% |
355,329,928 |
8.3% |
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2007 |
275,888,713 |
9.4% |
145,705,424 |
41.2% |
421,594,137 |
18.6% |
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Portland Metro Uncompensated
Care By Quarter: |
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Quarter |
Charity Care |
% Change from Prev. Quarter |
Bad Debt |
% Change From Prev. Quarter |
Total Uncomp. Care |
% Change from Prev. Quarter |
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2002(1) |
11,479,878 |
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18,836,946 |
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30,316,824 |
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2002(2) |
18,614,409 |
62.1% |
17,759,174 |
-5.7% |
36,373,583 |
20.0% |
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2002(3) |
13,721,595 |
-26.3% |
23,248,438 |
30.9% |
36,970,033 |
1.6% |
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2002(4) |
19,656,889 |
43.3% |
23,135,063 |
-0.5% |
42,791,952 |
15.7% |
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2003(1) |
13,730,936 |
-30.1% |
17,208,616 |
-25.6% |
30,939,552 |
-27.7% |
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2003(2) |
37,305,596 |
171.7% |
26,785,613 |
55.7% |
64,091,209 |
107.1% |
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2003(3) |
28,987,468 |
-22.3% |
30,667,896 |
14.5% |
59,655,364 |
-6.9% |
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2003(4) |
33,283,890 |
14.8% |
31,722,868 |
3.4% |
65,006,758 |
9.0% |
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2004(1) |
29,908,658 |
-10.1% |
29,925,527 |
-5.7% |
59,834,185 |
-8.0% |
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2004(2) |
35,256,245 |
17.9% |
21,707,210 |
-27.5% |
56,963,455 |
-4.8% |
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2004(3) |
40,229,168 |
14.1% |
34,314,926 |
58.1% |
74,544,094 |
30.9% |
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2004(4) |
46,907,695 |
16.6% |
28,330,092 |
-17.4% |
75,237,787 |
0.9% |
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2005(1) |
48,079,206 |
2.5% |
27,708,989 |
-2.2% |
75,788,195 |
0.7% |
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2005(2) |
53,105,689 |
10.5% |
31,336,784 |
13.1% |
84,442,473 |
11.4% |
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2005(3) |
46,053,497 |
-13.3% |
37,410,911 |
19.4% |
83,464,408 |
-1.2% |
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2005(4) |
56,182,418 |
22.0% |
28,107,191 |
-24.9% |
84,289,609 |
1.0% |
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2006(1) |
71,527,602 |
27.3% |
7,201,604 |
-74.4% |
78,729,206 |
-6.6% |
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2006(2) |
55,563,258 |
-22.3% |
35,347,591 |
390.8% |
90,910,849 |
15.5% |
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2006(3) |
59,212,753 |
6.6% |
31,564,899 |
-10.7% |
90,777,652 |
-0.1% |
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2006(4) |
65,825,212 |
11.2% |
29,241,769 |
-7.4% |
95,066,981 |
4.7% |
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2007(1) |
72,092,961 |
9.5% |
23,088,693 |
-21.0% |
95,181,654 |
0.1% |
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2007(2) |
67,984,640 |
-5.7% |
36,072,963 |
56.2% |
104,057,603 |
9.3% |
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2007(3) |
66,011,953 |
-2.9% |
45,488,804 |
26.1% |
111,500,757 |
7.2% |
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2007(4) |
69,799,159 |
5.7% |
41,054,964 |
-9.7% |
110,854,123 |
-0.6% |
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Type A and B Rural Hospitals
Uncompensated Care by Year: |
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Year |
Charity Care |
% Change from Prev. Year |
Bad Debt |
% Change from Prev. Year |
Total Uncomp. Care |
% Change from Prev. Year |
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1994 |
5,751,198 |
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17,166,341 |
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22,917,539 |
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1995 |
5,487,446 |
-4.6% |
15,841,422 |
-7.7% |
21,328,868 |
-6.9% |
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1996 |
5,655,492 |
3.1% |
15,434,468 |
-2.6% |
21,089,960 |
-1.1% |
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1997 |
6,250,843 |
10.5% |
17,359,492 |
12.5% |
23,610,335 |
12.0% |
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1998 |
7,571,274 |
21.1% |
19,532,965 |
12.5% |
27,104,239 |
14.8% |
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1999 |
7,363,747 |
-2.7% |
21,478,188 |
10.0% |
28,841,935 |
6.4% |
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2000 |
8,299,660 |
12.7% |
27,056,152 |
26.0% |
35,355,812 |
22.6% |
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2001 |
9,114,249 |
9.8% |
26,555,598 |
-1.9% |
35,669,847 |
0.9% |
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2002 |
13,608,081 |
49.3% |
26,465,615 |
-0.3% |
40,073,696 |
12.3% |
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2003 |
21,318,814 |
56.7% |
36,942,804 |
39.6% |
58,261,618 |
45.4% |
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2004 |
32,601,313 |
52.9% |
48,404,890 |
31.0% |
81,006,203 |
39.0% |
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2005 |
49,796,784 |
52.7% |
50,777,528 |
4.9% |
100,574,312 |
24.2% |
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