- Total healthcare spending in the United States increased from an estimated $1.4 trillion in 1996 to an estimated $3.1 trillion in 2016, according to a JAMA study published Tuesday. Spending per person was $5,259 annually in 1996 compared with $9,655 each 20 years later.
- The study found little change in how those services were paid for over time, although payments from public payers increased more than private payments during the period examined. Private insurance accounted for 48% of spending in 2016, followed by public insurance at 42.6% and out-of pocket payments at 9.4%.
- Lower back and neck pain and other musculoskeletal disorders accounted for the highest amount of spending in 2016 at an estimated $134.5 billion — 57.2% of which was paid for by private insurance. Spending on diabetes and urogenital and blood disorders followed.
Healthcare remains a key issue across America particularly as costs continue to rise, and are decried by Democratic presidential candidates. The topic likely will be further thrust into the spotlight as the U.S. Supreme Court will review the Affordable Care Act during its next term and whether the law can stand.
But before that happens, the presidential election could determine how much the public — faced with coverage issues such as narrow networks, increasing out-of-pocket costs and surprise bills — wants a national healthcare system.
JAMA's research looked at those growing costs, who pays them and what health conditions are the priciest to treat. The study analyzed 154 health conditions by age and sex from 1996 through 2016, relying on data from insurance claims; ambulatory, dental or emergency department visits; inpatient and nursing care facility bed-days; and prescribed pharmaceuticals.
After adjusting for increases in population size and the aging population, 108 of 154 conditions had spending increases between 1996 and 2016. Musculoskeletal disorders and diabetes had the highest costs, and were most common among working adults ages 20 to 64.
Those 65 and over made up a majority of spending on the next most expensive conditions — hypertension, dementia and ischemic heart disease — and were covered largely by public insurance, such as Medicare or Medicaid.
But dementia also carried the highest fraction of out-of-pocket payments of all conditions, mostly spent on nursing facility stays.
Another notable finding was a substantial increase in public insurance spending on prescribed pharmaceutical care. Although 49% of prescribed pharmaceutical care spending was by private insurance across all years, spending by public insurance increased from 19% in 1996 to 40.6% in 2016.
A common denominator among health conditions with the highest spending increases was the introduction of specialty drug treatments, according to the study. Specialty drugs for conditions such as rheumatoid arthritis, multiple sclerosis and osteoarthritis, among others, contributed to an estimated 43% of net pharmaceutical spending across all health conditions — despite only being 2% of the volume in 2016.
In an editorial published alongside the report, Andrew Bindman, professor at the University of California, San Francisco's Philip R. Lee Institute for Health Policy Studies, wrote that higher prices are driving the spending increase, pointing to a rapid consolidation of health systems where "U.S. physicians are increasingly working for hospitals, and hospitals are in turn merging to formulate large chains."
And by limiting competition, those chains effectively undermine insurers' attempts to negotiate lower prices. "There has been considerable public attention focused on the lack of competition among banking and high-tech companies, but it is increasingly evident that this is an emerging issue in health care as well," Bindman wrote. "And we are all paying the price for it."