Health Spending Patterns

Topic Outline

Concentration of Health Spending

Peterson-Kaiser Health System Tracker. How do health expenditures vary across the population? (12.1.17).
- In 2015, the top 1% of total population in U.S. accounted for 23% of all health expenditures; the top 5% accounted for 51% of spending.
- In 2015, the top 1% of total population in U.S. accounted for 19% of out-of-pocket health expenditures; the top 5% accounted for 45% of spending.
- In 2015, the top 1% of families in U.S. accounted for 14% of total health expenditures; the top 5% accounted for 37% of spending.
- In 2015, the top 1% of total population in fair or poor health in U.S. accounted for 16% of total health expenditures; the top 5% accounted for 38% of spending.
NICHM Foundation. Health Care’s 1%: The Extreme Concentration of U.S. Health Spending (November 2014).
- In 2012, the top 1% of non-institutionalized population in U.S. accounted for 23% of all health expenditures; the top 5% accounted for 50% of spending.
- Mean per capita spending was $98,000 for top 1% and $47,000 for top 5%.
- 39% of top 1% are elderly and 40% are age 45-64.
- While those in poor health account for 32.2% of the top 1%, nearly half self-report their health as Good (30.5%), Very Good (10.5%) or Excellent (4.1%).

CMS. Personal Health Care Spending by Gender, Age Group and Type of Service, Calendar Year 2004. Table provides aggregate and per capita estimates of personal health care (PHC) expenditures by type of service broken out by gender for 3 age groups (0-18, 19-64 and 65 & over).
Berhanu Alemayehu and Kenneth E Warner. The Lifetime Distribution of Health Care Costs (2004). Using private claims data, researchers calculated lifetime spending (year 2000 dollars), showing that per capita lifetime expenditure is $316,600, a third higher for females ($361,200) than males ($268,700). Two-fifths of this difference owes to women’s longer life expectancy.

Joan Costa-i-Font. Re-visiting the Health Care Luxury Good Hypothesis: Aggregation, Precision, and Publication Biases? (January 2009)

Dartmouth Atlas of Health Care provides a large compendium of information on how health expenditures vary by geography and the reasons why.
Variations (Health Affairs). Links to numerous articles on the topic of geographic variations in utilization and expenditures.
Dunn, Abe C., Adam Hale Shapiro, and Eli Liebman. 2011. Geographic Variation in Commercial Medical-Care Expenditures: A Framework for Decomposing Price and Utilization. BEA Working Paper 2011–07 (July); www.bea.gov/papers.