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Updated March 21, 2019
U.S. Health Care Coverage and Spending
In 2017, the United States had an estimated population of
nonmedical net costs, which include, but are not limited to,
321 million individuals. Most of those individuals had
taxes, net gains or losses to reserves, and profits.
private health insurance or received health care services
under a federal program (such as Medicare or Medicaid).
Most of this spending was for hospital care and physician
About 8.7% of the U.S. population was uninsured.
and professional services (Figure 1). Private health
insurance spending, as a percentage of all health
Individuals (including those who were uninsured), health
consumption expenditures, has increased by about 12
insurers, and federal and state governments spent
percentage points since 1960 (Figure 2). This growth is
approximately $3.3 trillion on various types of health
partially due to increases in enrollment and, when
consumption expenditures (HCE) in 2017, which accounted
considered alongside the implementation and expansions of
for 17.1% of the nation’s gross domestic product.
Medicare and Medicaid, corresponds with the drop in out-
of-pocket spending since 1960.
Table 1. Health Care Coverage, 2017
Medicare
Enrollment
Medicare is a federal health insurance program that pays for
(millions/percent of
covered health care services for most people aged 65 and
Source
U.S. population)
older and for certain permanently disabled individuals
Insured
293 (91.3%)
under the age of 65.
Private health insurance – Group
176 (55.0%)
An estimated 55 million individuals (17.3% of the U.S.
Private health insurance – Non-group
43 (13.5%)
population) were enrolled in Medicare in 2017. The
program accounted for $706 billion (21.2% of overall
Medicare
55 (17.3%)
HCE); this share is about 10 percentage points higher than
Medicare’s percentage of HCE in 1970 (Figure 2). In 2017,
Medicaid/CHIP
66 (20.6%)
most of the spending was for hospital care and physician
Military - TRICARE
9 (2.7%)
and professional services (Figure 1).
Military - VA Care
7 (2.3%)
Figure 1. Health Consumption Expenditures by Type
Uninsured
28 (8.7%)
and Source, 2017
(in bil ions of dol ars)
Source: U.S. Census Bureau, Table HIC-4_ACS. Health Insurance Coverage
Status and Type of Coverage by State-Al Persons: 2008 to 2017, August 2018.
Notes: Italicized = does not add to total. Individuals may have more than
one type of coverage at a time (for example, Medicare and Medicaid).
Therefore, estimates by type of coverage are not mutual y exclusive.
CHIP = The State Children’s Health Insurance Program. Medicaid/CHIP
coverage estimate also includes al means-tested public coverage, such as
state and local y financed public coverage.
Private Health Insurance
Private health insurance is the predominant source of health
insurance coverage in the United States. The private health
insurance market includes both the group market (largely
Source: Centers for Medicare and Medicaid Services, National Health
made up of employer-sponsored insurance) and the non-
Expenditure Accounts—National Health Expenditures by Type of Expenditure
group market (commonly referred to as the individual
and Program, December 2018.
market, which includes plans directly purchased from an
Notes: Al of the terms used in this figure are defined in the source
insurer both on and off health insurance exchanges). In
document, except long-term services and supports, which is defined in the
2017, these markets covered an estimated 176 million
text of this In Focus. DME = durable medical equipment. CHIP = The
individuals (55.0% of the U.S. population) and 43 million
State Children’s Health Insurance Program.
individuals (13.5% of the U.S. population), respectively.
Medicaid/The State Children’s Health
In 2017, private health insurance accounted for $1,184
Insurance Program (CHIP)
billion (35.6% of overall HCE). Private health insurance
Medicaid is a joint federal-state program that finances the
expenditures (Figure 1) include amounts paid by insuring
organizations to providers and all insuring organizations’
delivery of primary and acute medical services, as well as
long-term services and supports, to a diverse low-income
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U.S. Health Care Coverage and Spending
population, including children, pregnant women, adults,
Out-of-Pocket Spending
individuals with disabilities, and people aged 65 and older.
Out-of-pocket spending (other than premiums) includes all
amounts paid by the privately insured and other insured
CHIP is a means-tested program that provides health
individuals for coinsurance, deductibles, and services not
coverage to targeted low-income children and pregnant
covered by insurance. It also includes any amounts paid by
women in families that have annual income above Medicaid
the uninsured for health care goods and services. Among all
eligibility levels but have no health insurance.
individuals, out-of-pocket spending totaled $365 billion
(11.0% of total HCE) in 2017.
Figure 2. Health Consumption Expenditures (HCE) by
Source as a Percent of Total HCE, 1960-2017
The Uninsured
Approximately 28 million individuals (8.7% of the U.S.
population) were uninsured in 2017. The uninsured rate was
relatively stable from 2008 to 2013 before dropping 6
percentage points by 2016 (Figure 3). This drop in the
uninsured rate corresponds with increases in non-group
coverage and Medicaid/CHIP coverage, which are
associated with the implementation of various provisions of
the Affordable Care Act (ACA; P.L. 111-148, as amended),
such as the exchanges and premium tax credits and the
Medicaid expansion.
Source: Centers for Medicare and Medicaid Services, National Health
Expenditure Accounts—National Health Expenditures by Type of Service and
Figure 3. Health Insurance Coverage by Source as a
Source of Funds, CY1960-2017, December 2018.
Percentage of Total U.S. Population, 2008-2017
Note: CHIP = The State Children’s Health Insurance Program.
An estimated 66 million individuals (20.6% of the U.S.
population) received Medicaid or CHIP in 2017, and the
programs accounted for $600 billion (18.0% of overall
HCE). This spending is about 10 percentage points higher
than Medicaid/CHIP’s percentage of total HCE in 1970
(Figure 2). Furthermore, Medicaid spends the highest
percentage of expenditures on long-term services and
supports, which includes (1) other health, residential, and
personal care; (2) nursing care facilities and continuing care
retirement communities; and (3) home health care (Figure
1). Long-term services and supports also includes some
Source: U.S. Census Bureau, Table HIC-4_ACS. Health Insurance Coverage
post-acute care (i.e., skilled care provided over a short term,
Status and Type of Coverage by State-Al Persons: 2008 to 2017, August 2018.
typically after a hospitalization).
Notes: Individuals may have more than one type of coverage at a time
Military
(for example, Medicare and Medicaid). Therefore, estimates by type of
coverage are not mutual y exclusive. CHIP = The State Children’s Health
Health care services for military servicemembers, veterans,
Insurance Program. Medicaid/CHIP coverage estimate also includes al
and their dependents are provided by the Department of
means-tested public coverage, such as state and local y financed public
Defense, through programs such as TRICARE, and the
coverage.
Department of Veterans Affairs. In 2017, an estimated nine
million individuals (2.7% of the U.S. population) had
TRICARE and seven million (2.3% of the U.S. population)
The cost of care for the uninsured population is accounted
individuals had VA Care. Together, these departments
for in multiple spending categories (Figure 1 and Figure
accounted for $114 billion (3.4%) of total HCE.
2). Payments made by uninsured individuals for health care
services are included in the out-of-pocket total. Any
Other Health Services
amounts received by providers that help to partially and/or
indirectly cover the cost of care for the uninsured are
Other health care spending covers services provided
through public and private programs not listed above,
accounted for in corresponding source totals (e.g., Medicare
including worksite health care programs, philanthropic
and Medicaid disproportionate share hospital payments are
included in program totals).
support, Indian Health Service activities, workers’
compensation, general assistance, the Maternal and Child
Health program, vocational rehabilitation, Substance Abuse
For more information about federal health programs, see
the CRS Health Care issue area page at http://www.crs.gov/
and Mental Health Services Administration grants, federal
iap/health-care.
and state public health activities, school health programs,
and other programs whose primary focus is the provision of
care or treatment of disease. Other health services
Ryan J. Rosso, Analyst in Health Care Financing
accounted for $355 billion (10.7% of total HCE) in 2017.
IF10830
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U.S. Health Care Coverage and Spending
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