A report from the National Institute for Health Care Management Foundation shows around 5% of the United States population is responsible for nearly half of all health care spending in America. Many of the people in that small group had at least one chronic health condition. It is interesting to see where the money is going.
We all know that health care is expensive. There have been ongoing debates about whether it is reasonable to blame the health insurance companies, the pharmaceutical companies, or large hospital chains for the rising cost of health care. This new report isn’t about pointing the finger of blame in any specific direction. Instead, it tracked where the money went.
A report was done by the National Institute for Health Care Management Foundation (NIHCM). This group is a nonprofit, nonpartisan, organization that is specifically focused on health care. The NIHCM took a close look at the 2008 Medical Expenditure Panel Survey for health care spending as a basis for their report. The results showed that the majority of health care spending was concentrated on a very small group of patients that had health conditions that were high-cost.
Where does the money go? 3.1% of all health care expenditures went to about half of the entire population of the United States. The other half of Americans required significantly higher expenditures. 63.6% of all health care spending went to around 10% of the population. The top 5% of the population of the United States generated around 47.5% of all health care spending. 20.2% of spending went to the top 1% of the population.
The report found that the average American incurred about $233.00 in medical bills for health care services in 2008. The people who were in the more expensive half of health care spending ended up with a much higher bill in that same year. Their bill came to $7,317, which was paid for by their health insurance company, the government, or the individuals themselves. That top 1% generated bills that cost $76,476.
What factors cause the most health care expenses? About half of the people in the group had one of more chronic condition, including high blood pressure, high cholesterol, and diabetes. Health care spending, overall, rose between 2005 and 2009. In that same timeframe, premium rates for private health insurance companies rose by around 15%. The report states that the higher amount spent on doctors and hospitals is the reason why premium rates increased during those years.
Not all chronic illnesses are preventable, but some of them are. In my opinion, if more was done to make it possible for people to receive the appropriate kinds of preventative care, before their medical conditions got too far, it could prevent some people from ever developing those conditions. It seems to me that this could make less people end up in that super expensive 5% of the population. Perhaps the result would be that the overall cost of health care would lower.
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