Impact of Rising Health Care Costs

These are straight from the National Coalition on Health Care (NCHC), but they represent a sobering view of the impact of our rising costs. For the broader list of facts, you can go to their website.

  • In 2008, health care spending in the United States reached $2.4 trillion, and was projected to reach $3.1 trillion in 2012.1 Health care spending is projected to reach $4.3 trillion by 2016.1
  • Premiums for employer-based health insurance rose by 5.0 percent in 2008. In 2007, small employers saw their premiums, on average, increase 5.5 percent. Firms with less than 24 workers, experienced an increase of 6.8 percent.2
  • Health care spending is 4.3 times the amount spent on national defense.3
  • Health insurance expenses are the fastest growing cost component for employers. Unless something changes dramatically, health insurance costs will overtake profits by the end of 2008.4
  • The percentage of Americans under age 65 whose family-level, out-of-pocket spending for health care, including health insurance, that exceeds $2,000 a year, rose from 37.3 percent in 1996 to 43.1 percent in 2003 – a 16 percent increase.5
  • A recent study by Harvard University researchers found that the average out-of-pocket medical debt for those who filed for bankruptcy was $12,000. The study noted that 68 percent of those who filed for bankruptcy had health insurance. In addition, the study found that 50 percent of all bankruptcy filings were partly the result of medical expenses.6 Every 30 seconds in the United States someone files for bankruptcy in the aftermath of a serious health problem.
  • A new survey shows that more than 25 percent said that housing problems resulted from medical debt, including the inability to make rent or mortgage payments and the development of bad credit ratings.7
  • About 1.5 million families lose their homes to foreclosure every year due to unaffordable medical costs. 8
  • A survey of Iowa consumers found that in order to cope with rising health insurance costs, 86 percent said they had cut back on how much they could save, and 44 percent said that they have cut back on food and heating expenses.9

Notes

  1. Keehan, S. et al. “Health Spending Projections Through 2017, Health Affairs Web Exclusive W146: 21 February 2008.
  2. The Henry J. Kaiser Family Foundation. Employee Health Benefits: 2008 Annual Survey. September 2008.
  3. California Health Care Foundation. Health Care Costs 101 — 2005. 02 March 2005.
  4. McKinsey and Company. The McKinsey Quarterly Chart Focus Newsletter, “Will Health Benefit Costs Eclipse Profits,” September, 2004.
  5. Agency for Heathcare Research and Quality. Out-of-Pocket Expenditures on Health Care and Insurance Premiums Among the Non-elderly Population, 2003, March 2006.
  6. Himmelstein, D, E. Warren, D. Thorne, and S. Woolhander, “Illness and Injury as Contributors to Bankruptcy, ” Health Affairs Web Exclusive W5-63, 02 February , 2005.
  7. The Access Project. Home Sick: How Medical Debt Undermines Housing Security. Boston, MA, November 2005.
  8. Robertson, C.T., et al. “Get Sick, Get Out: The Medical Causes of Home Mortgage Foreclosures,” Health Matrix, 2008
  9. Selzer and Company Inc. Department of Public Health 2005 Survey of Iowa Consumers, September 2005.

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