KFF: Health-Care Spending Reaches $1.6 Trillion

May 3, 2004 (PLANSPONSOR.com) - Across the United States in 2002, health-care spending totaled $1.6 trillion.

Of the $1.6 trillion total, about one-third of this was for hospital care, over one-fifth for physician services, and about 10% for prescription drugs , according to the Kaiser Family Foundation’s (KFF) Trends and Indicators in the Changing Health Care Marketplace, 2004 Update. Compared to data released in 2002 that showed prescription drug spending was the fastest growing component (See Drug Cost Increases Lead Health Stats ), KFF found drug spending now appears to be moderating while the growth in hospital costs is rising.

KFF also found a noticeable increase in Preferred Provider Organization (PPO) enrollment between 1996 and 2002, from 28% to 54% of those covered by employment-sponsored health insurance. During the same period, Health Maintenance Organization (HMO) enrollment declined from 31% to 24%. About two-thirds of the non-elderly are covered by employer-sponsored coverage, which remains consistent with 2002’s results.

Among the uninsured population, nearly half (47%) postponed care because of cost, compared with a similar decision by just 15% of the insured population. Further, 37% of uninsured adults did not fill a prescription because of cost compared to 13% of the insured), and 35% reported skipping recommended treatment because of cost, versus 13% of the insured.

A copy of the update for 2004 can be found at http://www.kff.org/insurance/7031/index.cfm .