Download January 1993 - Employee Benefit Research Institute

FACTS
from EBRI
Employee Benefit Research Institute • 2121 K Street, NW, Suite 600 - Washington, DC • 20037
National
Health Care Expenditures
• National health expenditures reached $751.8 billion in 1991, or 13.2 percent of the U. S. gross domestic
product (GNP), from $250.1 billion or 9.2 percent of GDP in 1980. Health spending has continued to outgrow
the other economic sectors combined and currently amounts to more than twice the proportion of GDP that it
accounted for in 1965 (5.9 percent).
• In 1992, total government expenditures on health care were $330.0 billion (44 percent of national health
expenditures). The federal government spent $222.9 billion (30 percent of total expenditures) on health care,
while state and local governments contributed $107.1 billion (14 percent). These figures are up from
$10.3 billion in total government expenditures in 1965, with the federal government spending $4.8 billion and
state and local governments spending $5.5 billion.
• Federal government expenditures accounted for only 12 percent of total health expenditures in 1965, the
year prior to Medicare's implementation. Since the early 1970s, the proportion of national health expenditures accounted for by public sources has remained essentially constant.
• Private expenditures totaled $421.8 billion (56 percent of total health spending) in 1991. In 1965, private
expenditures accounted for 75 percent of national health expenditures, in 1970 it was 63 percent, and since
1975 the proportion has remained nearly constant.
• Payments through insurance companies of $244.4 billion were the largest portion of private expenditures
for health care. Direct out-of-pocket payments for health care amounted to $144.3 billion. Out-of-pocket
payments declined from 34 percent of total expenditures in 1970 to 16 percent in 1991, and private insurance
payments increased from 23 percent to 33 percent of total health expenditures over the same period.
• In 1991, 97 percent of health care spending went to health services and supplies; the remaining 3 percent
was for research and construction expenses. Personal health care spending, including all goods and services
received directly by patients, was $660.2 billion--the largest component of health services and supplies.
• Hospital care is the single greatest personal health care expense, representing $288.6 billion in 1991, a
13 percent increase over 1990. Physicians' services is the second largest component of personal health care,
accounting for $142 billion in 1991, an 13 percent increase over 1989.
• Physicians'
services and hospital care together account for 55 percent of all national health spending.
• Other components of personal health care include nursing home care (8 percent of total national health
spending), drugs and other medical nondurables (8 percent), dental services (5 percent), care delivered by
health professionals other than physicians and dentists (5 percent), vision products and other medical
durables (2 percent), and home health care (1 percent).
• Spending on drugs and dental services continued to grow slower than overall health expenditures in 1991.
Spending for home health services and health services provided by professionals other than physicians and
dentists grew considerably in the last 20 years; however, they are relatively small components of the total U.S.
health care bill.
For more information,
call Carolyn Piucci, (202) 775-6341 or Laura Bos, (202) 775-6318.
Source:EBRIDatabookon EmployeeBenefits,secondedition, 1992;EBRIIssueBriefno. 119,"Questionsand Answers aboutEmployeeBenefits,"
October1991;and EBRIIssueBriefno. 114,"HealthCare:WhatRole in the U.S.Economy,"May 1991.
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