According to research from the Washington, D.C.-based JPMorgan Chase Institute, Americans are spending more on average for healthcare, with the burden falling heaviest on women, low-income families and pre-retirees.
In “Paying Out-of-Pocket: The Healthcare Spending of 2 Million U.S. Families,” researchers found that Americans spent an average of $714 on out-of-pocket healthcare spending in 2017.
Out-of-pocket healthcare payments have grown by an average of 4.3 percent each year since 2013, but have remained stable as a share of Americans’ income.
The study links healthcare with financial health: Access to healthcare often hinges on access to cash to pay out-of-pocket costs like copays, deductibles and fees for services not covered by insurance.
American households delay healthcare payments until they have liquid assets at their disposal. The researchers found that healthcare payments spiked noticeably during March and April, when most Americans receive their tax refund payments.
The top 10 percent of healthcare spenders account for almost half of the total out-of-pocket healthcare spending. Doctor, dental and hospital payments accounted for more than half of the out-of-pocket healthcare payments analyzed in the study.
JPMorgan Chase bills the work as the first look at out-of-pocket healthcare spending by U.S. consumers that uses actual financial transactions. The report evaluates the month-to-month spending of 2.3 million Americans at the state, metro and county level, showing how spending habits changed over four years from 2013 to 2016.
The report says that women, low-income families and pre-seniors are spending the most on healthcare. Women spent 1.8 percent of their take-home income on healthcare in 2016, compared to 1.5 percent among men. The bottom income quintile of Chase account holders spent 2.8 percent of their take-home income on out-of-pocket healthcare costs in 2016, compared to only 1 percent of take-home income for the top quintile of households. While 18 to 25 year olds spent just 1.2 percent of their income on healthcare, out-of-pocket costs accounted for 1.9 percent of the income of 55 to 64 year olds .
Out-of-pocket healthcare expenses tend to be a matter of geography, according to the authors, because states play important roles in shaping healthcare policy. Californians on average spend the least on out-of-pocket healthcare costs ($596), while Coloradoans spend the most ($916). Families in Louisiana and Oklahoma spent the most as a percentage of income.
Chronic conditions are also taking a toll on U.S. households—families that reach the top 10 percent of healthcare spenders in a given year tend to remain among the highest spenders on a year-over-year basis, according to the report.