Most healthcare spending goes to small portion of population

A new government study confirms what many primary care physicians have long suspected, based on their own experience: A relatively small number of Americans consume a large portion of the nation’s healthcare resources.

A Statistical Brief prepared by the Agency for Healthcare Research and Quality (AHRQ) shows that in 2010 the top 1% of the population, as ranked by healthcare expenses, accounted for 21.4% of the country’s healthcare spending of $1.263 trillion. The top 5% accounted for just under half of the total expenditures, and the top 50% accounted for a whopping 97.2% of expenditures, leaving just 2.8% of the total for the bottom 50%.

Although heavily concentrated, the spending numbers actually represent an improvement from the late 1990s. At that time the top 1% accounted for 28% of healthcare spending, and the top 5% accounted for more than 50%.

The Statistical Brief examines concentration of healthcare spending using a variety of categories, including age, race sex, insurance status, chronic condition, and income. Some of its findings:

• Among the uninsured, the top 5% accounted for 67.3% of spending, with an annual mean expenditure level of $17,453 per patient.

• Among children under age 18, the top 5% accounted for 54.6% of spending, with an annual mean expenditure of $16,900 per person. At the other end of the age spectrum, the top 5% of those aged 65 and older accounted for 34% of spending among that sub-group, but the annual mean expenditure was $67,474.

• Among non-Hispanic blacks, the top 5% accounted for 58.4% of expenditures with an annual mean expenditure of $47,329, while for the top 5% of non-Hispanic whites the figures were 46.2% and $43,236, respectively.

• Among Hispanics, the top 5% accounted for 60.3% of healthcare expenditures with a mean annual expenditure of $27,307.

• The top 5% of men accounted for 55.7% of healthcare expenditures, but the annual mean individual levels were nearly equal between the sexes-$40,852 for men versus $40,617 for women.

Data for the survey were taken from the household component of the AHRQ’s Medical Expenditure Panel Survey.