Saturday, August 15, 2009

How much do US households really spend on Health Care?

There are a lot of scare tactics being used by the media, and also many politicians, in the Health Care discussion underway in this country.
However, the BLS CES survey collects very detailed data from millions of Americans via two methods to measure actual out-of-pocket spending - Food, Clothing, Housing, Prescription Drugs, Health Insurance, Entertainment, Utilities, Medical Supplies etc.

Turns out, the average American household spends more on discretionary items like Dining Away from Home and Tobacco combined, than they do on all Health Care components, including Health Insurance! [not including the 1% Medicare tax]

The average household spends $2853/year out-of-pocket on their Health Care, but a whopping $6146 on the 4 discretionary areas Dining out, Tobacco, Alcohol, and Entertainment, a difference of $3293 or 115%.

Ah, but that's the 'average' household, and we know averages can hide things. What about different age groups?

http://spreadsheets.google.com/ccc?key=0AmwlX5Z3a7pVdEptZlA5OWowUWp2OTNuVGIwM1hjbVE&hl=en

Ages 25-34 spend $1000 more on Dining out than Health Care.
Ages 35-44 spend $900 more on Dining out.
Ages 45-54 spend $390 more on Dining out. They spend 159% more on Dining out, entertainment, tobacco and drinking than their own Health Care.

Ages 55-64 spend $200 more on Dining out, smoking, and Alcohol than their own Health Care.

Ages 65-74, the older cohort, the one that has the most HC spending of all the aoove groups? They still spend more on dining out, entertainment, drinking and smoking than their own health care!

Not until you look at age groups solely 75 and over;<5% of all Americans, do we spend more on HC than the 4 discretionary categories above, and that goes not just those with health insurance but all Americans surveyed.

For every horror story you hear about a $100k hospital bill [that saved their life, generally] there are over 300 million people that didn't have those costs. That's the part the media never reports, along with all the other facts here.

And yes, in some areas of the country, HC costs more particularly in expensive cities with litigious populations, like where I live. Funny, how Tort Reform hasn't been mentioned by the WH so far this year as an unnecessary driver of HC costs.

This is why most Americans survey report being 'happy' or 'very happy' with their health care. They [and I] would just like to see the Feds stop subsidizing employer-provided care and allow portability of polices across firms and more importantly, across state lines.

Here is the link to the latest BLS data, chopped and diced any way you wish:
ftp://ftp.bls.gov/pub/special.requests/ce/standard/2007/age.txt