A. Health Spending

 VI. Key Issues: Financing and Delivery >> A.  Health Spending

Topic Outline

 1. Health spending patterns
      a. Spending by function
      b. Spending by service
      c. Spending by age
      d. Spending by gender
      e. Spending by geographic area
      f. Spending by disease

2. Health spending trends
     a. Historical trends
     b. Projections

3. Avoidable health spending
4. Health cost containment
     a. Promote Competition
1. Managed Competition
          2. Consumer-Directed H.C.
     b. Transparency
     c. Business Coalitions
     d. Promote Healthy Behavior
     e. Promote Efficient Use
 1. Improve Administration
          2.  Health IT
          3. Reduce Admin. Waste
          4. Manage Health Benefits
     f.  Improve Quality


Since 1964, the United States Department of Health and Human Services has published an annual series of data presenting total national health expenditures. These estimates, termed National Health Expenditure Accounts (NHEA), are compiled with the goal of measuring the total annual dollar amount of health care consumption in the United States, as well as the dollar amount invested in medical sector structures and equipment and non-commercial research to procure health services in the future. They differ from estimates of national health spending available through the Bureau of Economic Analysis National Income and Product and Accounts. Both of these are “top down” estimates of spending derived largely from aggregate estimates of spending by health sub-sectors (e.g., hospitals, nursing homes, physician offices). The U.S. also conducts an on-going household survey, the Medical Expenditure Survey, from which annual “bottoms-up” estimates of health spending can be derived based on extrapolating the estimates for individual households multiplied by the number of households in that category etc. This method produces a lower estimate of aggregate spending relative to the NHEA, but researchers have shown how to reconcile the two; in 2002, MEPS costs had to be inflated by a factor of 1.22 to match NHEA.



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