HEALTH

US household spending on health care tops $1 trillion in 2018 for first time

Dec 5, 2019, 3:11 PM

health care spending...

Photo: Getty Images

(CNN) — American households spent more than $1 trillion on health care in 2018, reaching a pricey milestone, according to federal data released Thursday.

That includes out-of-pocket expenses for medical services and premiums for employer coverage, individual policies and Medicare, as well as Medicare payroll taxes. The figure grew by 4.4% from a year earlier.

The data — part of the National Health Expenditure report — comes as Americans, elected officials and presidential candidates try to tame the rising cost of health care. The issue is a top priority for President Donald Trump and has split the Democrats primary contenders.

Progressive candidates such as Sens. Bernie Sanders of Vermont and Elizabeth Warren of Massachusetts argue that the best way to reduce costs is to have the federal government take over the health insurance industry, while moderates such as former Vice President Joe Biden and South Bend, Indiana, Mayor Pete Buttigieg advocate less radical steps, such as a government-run health insurance option.

Overall, US health care spending rose 4.6% to $3.6 trillion last year, faster than in 2017 but the same as 2016, according to the report, issued by the Centers for Medicare and Medicaid Services. It accounted for 17.7% of the economy, slightly less than a year earlier.

Notably, the prices for prescription drugs at retail pharmacies fell 1% in 2018 — the first time since 1973 — due to a drop in generic drug prices and relatively low growth in brand-name drug prices. The data is based on the consumer price index for prescription drugs, which Trump often cites to show his progress in lowering health care spending. Some experts, however, say this index does not truly reflect the rising cost of drugs, in part because it excludes the pricey medications administered in hospitals and doctors’ offices.

Private businesses, meanwhile, shelled out nearly $727 billion on health care, an increase of 6.2% — the fastest growth rate since 2003. More than three-quarters of that spending is on employer contributions for insurance premiums, which rose at a quicker pace than in 2017.

Spending by Medicare, Medicaid and private health insurance grew faster in 2018 partly because of the reinstatement of the health insurance tax, an Affordable Care Act provision that Congress suspended for 2017. The tax was expected to raise $14.3 billion in 2018, according to the Internal Revenue Service.

While the growth in health care usage slowed last year, larger hikes in prices more than offset it. Hospital prices rose 2.4% last year, somewhat faster than the year before. Hospital spending accounts for one-third of health care expenditures.

The number of uninsured people rose by 1 million for the second year in a row, to 30.7 million in 2018. The uninsured rate remained roughly steady at less than 10%. Democrats have slammed Trump for undermining the Affordable Care act, which helped reduce the uninsured rate after the health insurance exchanges opened and states expanded Medicaid in 2014.

The-CNN-Wire
™ & © 2019 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

We want to hear from you.

Have a story idea or tip? Send it to the KSL NewsRadio team here.

Health

Rep. Tyler Clancy, R-Provo, speaks about HB261 at the Capitol in Salt Lake City on Friday, Jan. 19,...

Aimee Cobabe

Lawmaker wants to increase maximum amount of time for involuntary civil commitments

Utah lawmakers are supporting a bill to increase the maximum amount of time for involuntary civil commitments.

9 hours ago

woman with a therapeutic device on her head to treat depression...

LAURA UNGAR

A brain pacemaker helped a woman with crippling depression. It may soon be available to more people

Researchers say deep brain stimulation, or DBS — could eventually help many of the nearly 3 million Americans with treatment-resistance depression.

14 hours ago

Mothers and mental health...

Mira Cheng, CNN

Maternal mental health conditions drive climbing death rate in US, research says

The maternal mortality rate in the US is two- to threefold greater than in other high-income countries and increasing.

18 hours ago

A Gila monster is displayed at the Woodland Park Zoo in Seattle, Dec. 14, 2018....

MEAD GRUVER Associated Press

A Colorado man is dead after a pet Gila monster bite

A Colorado man has died after being bitten by his pet Gila monster in what would be a rare death if the creature's venom was the cause.

1 day ago

students walk to a bus, kindness ewalls coming to utah's k-12 schools...

Britt Johnson

Schools in Utah to get Kindness eWalls

Kindness eWalls display positive messages submitted by a school's students, teachers and parents.

2 days ago

Exercise particularly reduced risk of death for women, according to the data....

Madeline Holcombe, CNN

Women might lower their risk for cardiovascular disease by twice the amount as men with exercise

The benefits of exercise are great for everyone – but may be even better for women, according to a new study.

2 days ago

Sponsored Articles

Mother and cute toddler child in a little fancy wooden cottage, reading a book, drinking tea and en...

Visit Bear Lake

How to find the best winter lodging in Bear Lake, Utah

Winter lodging in Bear Lake can be more limited than in the summer, but with some careful planning you can easily book your next winter trip.

Happy family in winter clothing at the ski resort, winter time, watching at mountains in front of t...

Visit Bear Lake

Ski more for less: Affordable ski resorts near Bear Lake, Utah

Plan your perfect ski getaway in Bear Lake this winter, with pristine slopes, affordable tickets, and breathtaking scenery.

front of the Butch Cassidy museum with a man in a cowboy hat standing in the doorway...

Bear Lake Convention and Visitors Bureau

Looking Back: The History of Bear Lake

The history of Bear Lake is full of fascinating stories. At over 250,000 years old, the lake has seen generations of people visit its shores.

silhouette of a family looking over a lake with a bird in the top corner flying...

Bear Lake Convention and Visitors Bureau

8 Fun Activities To Do in Bear Lake Without Getting in the Water

Bear Lake offers plenty of activities for the whole family to enjoy without having to get in the water. Catch 8 of our favorite activities.

Wellsville Mountains in the spring with a pond in the foreground...

Wasatch Property Management

Advantages of Renting Over Owning a Home

Renting allows you to enjoy luxury amenities and low maintenance without the long-term commitment and responsibilities of owning a home.

Clouds over a red rock vista in Hurricane, Utah...

Wasatch Property Management

Why Southern Utah is a Retirement Paradise

Retirement in southern Utah offers plenty of cultural and recreational opportunities. Find out all that this region has to offer.

US household spending on health care tops $1 trillion in 2018 for first time