• National health expenditures: up, up, up, up, up

    A new data brief from the National Institute for Health Care Management characterizes many of the woes of the U.S. health system with some beautifully designed charts. I’ll be using them in my posts even if they illustrate things already covered many times here. They’re really just too well done not to share. Let’s start with Figure 1, which packs a lot of data into one chart:

    I think these spending data speak for themselves, but if you need someone else to “speak” to you about them, check out the data brief.

    Next up, the spending distribution. Yep, still skewed:

    As shown in Figure 3, 15.6 percent of the civilian,non-institutionalized population had no health carespending at all in 2008 and the half of the populationwith the lowest spending accounted for only 3.1percent of all expenditures. In contrast, 63.6 percentof all spending was incurred by the 10 percent ofthe population with the highest spending. The top 5percent of the population accounted for almost half(47.5 percent) of all spending, and the top 1 percentof the population was responsible for 20.2 percent ofspending.

    How much, on average, is spent by and on behalf of those in various ranges of the distribution? They’ve got that covered too:

    Zowie! If you’re among the unlucky sick in the top 30% of the spending distribution, you’re accounting for over $11,000 in health care, on average. Even the average individual in the top half of the distribution has spending well above the deductible of most “high-deductible” health plans.

    I’ll post some more charts from the NIHCM data brief tomorrow. If you can’t wait, you know where to find it.

    • Beautiful curves indeed.
      I have no comment but just an observation re Fig 3. The skewed nature of the curve is normal, isn’t it? And that’s why there is health insurance to begin with. Because we don’t know who’ll become seriously ill and therefore fall into the high spending category, we have to buy insurance. If the curve were somehow straight diagonally, then everybody will be predictably spending the same amount of health care money and there will be no need for insurance.

    • Before this debate on healthcare started in earnest, I used to really fear medical bills and fear for people without insurance but it turns out that my fears where even bigger than they should have been. Before the debate educated me, if someone had told me that they did not have health insurance I would try to get them to get a policy right away. I do not do that anymore, sure it is risky but it is not as bad as I thought. Even if you are in the top spending category on the last chart ($76,476), if you are at least median income and the intervention returns you to health, you can amortize the bill. I still think that people should get a high deductible health insurance policy but I understand that if one is comfortable with risk, it is not that bad a bet to take

      Also I have learned that health care is less important for health than I thought it was.

      The real problem is care for the poor I think that some sort of medicaid that is gradually phased out as income rises would be sufficient intervention by Government. Medicaid needs to avoid a high effective marginal tax rate. I like the idea of medicaid with a deductible equal the family’s last year income minus the poverty rate.

      BTW There was good news on medicaid announced recently:


    • When you look at this post here,


      it is pretty clear why costs are rising at an unsustainable level. If these are the problems we know about, think about how much waste and ineffective medicine is going on that we do not know about.