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Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 1 An Overview of the U.S. Health Care System Chart.

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Presentation on theme: "Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 1 An Overview of the U.S. Health Care System Chart."— Presentation transcript:

1 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 1 An Overview of the U.S. Health Care System Chart Book Centers for Medicare and Medicaid Services And Office of the Assistant Secretary for Planning and Evaluation January 31, 2007

2 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 2 Table of Contents - Section 1 Section 1: Overview of the U.S. Health Care System8 Table 1.1National Health Expenditures and their share of GDP, 1980-20159 Table 1.2National Health Expenditures per Capita, 1980-201510 Table 1.3Personal Health Expenditures by Source of Funds, 1960-200411 Table 1.4Health Insurance Coverage for the Under 65 Population, 1980-200412 Table 1.5Personal Health Care Expenditures by Service, 1960-200313 Table 1.6Annual Percent Change in Personal Health Care Expenditures for Medicare, Medicaid, and Total, 1971-201514 Table 1.7Average Annual Growth in Medicare & Private Health Insurance Benefits Per Enrollee, Selected Periods15 Table 1.8Concentration of Health Spending, 1987-200216 Table 1.9Factors Accounting for Growth in Prescription Drug Spending per Capita, 1980-201117 Table 1.10Prescription Drug Expenditures by Source of Funds, 1965-200418 Table 1.11Sources of Payment for Nursing Home and Home Health Care, 200419 Table 1.12Number of People Employed in Health Care, 1990-200520 Table 1.13Health Care Employment by Occupation, 1983-200521 Table 1.14Health Care Employment Growth Projections, 2000-201022 Table 1.15Average Annual Salaries of Selected Groups of Workers, 200523 Table 1.16HMO Enrollment by Ownership Status, 1981-200424 Table 1.17Concentration of Managed Care Enrollment, 1988-200325 Table 1.18Managed Care Enrollment by Type of Plan, 1984-200426 Table 1.19Health Care as a Percent of Income by Age, 200427 Table 1.20Annual Growth Rates in the Overall CPI and MCPI, 1993-200528

3 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 3 Table of Contents - Section 2 Section 2: International Comparisons29 Table 2.1Percent of GDP Spent on Health Care by OECD Country, 1960-200430 Table 2.2Per Capita Spending on Medical Services by OECD Country, 1980-200431 Table 2.3Average Annual Growth in Per Capita Spending by Decade by OECD Country, 1960-200332 Table 2.4Per Capita Health Spending by Type of Service by OECD Country, 200333 Table 2.5Share of Total Health Spending on Outpatient care by OECD Country, 1970-200334 Table 2.6National Health Spending by Source of Funds by OECD Country, 200335 Table 2.7Per Capita Spending on Drugs and other Non-durables by OECD Country, 1970-200336 Table 2.8Drug Spending as a Percentage of Total Health Spending, 1980-200337 Table 2.9Infant Mortality Rates per 1,000 Live Births by OECD Country, 1970-200438 Table 2.10Male and Female Life Expectancy at Birth by OECD Country, 1960-200439 Table 2.11Male and Female Life Expectancy at Age 65 by OECD Country, 1960-200440 Table 2.12Number of Inpatient Discharges and Total Beds per 1,000 persons, by OECD Country, 200441 Table 2.13Average Length of Hosptial Stay for Selected OECD Countries, 200442 Table 2.14Medical Technology and Use of High Technology Medical Procedures by OECD Country, 200443 Table 2.15Selected Indicators of Mobidity by OECD Country, Selected Years44 Table 2.16Selected Indicators of Mortality by OECD Country, 200445

4 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 4 Table of Contents - Section 3 Section 3:Providers46 Table 3.1Number of Hospitals by Type, 1980-200447 Table 3.2Number of Hospital Beds and Occupancy Rates by Hospital Type, 1980-200448 Table 3.3Number of Hospital Beds per 1,000 Persons by State, 200449 Table 3.4Number of Nursing Home Beds & Residents, 1985-200350 Table 3.5Number of Physicians per 100,000 Persons by State, 200451 Table 3.6Distribution of Active Physicians:1950-199852 Table 3.7Percentage of Physicians in Differing Practice Arrangements, 1987-200153 Table 3.8Physician Revenue by Payer, 1986-200454 Table 3.9Physician Participation in Managed Care, 1988-200155 Table 3.10Physician Managed Care Payment Arrangements, 200156 Table 3.11Hospital Participation in HMOs and PPOs, 1987-200457 Table 3.12Hospital Managed Care Payment Arrangements, 200158 Table 3.13Hospital Profit Margins for All Payers and Medicare, 1997-200459 Table 3.14Hospital Payment to Cost Ratios for Medicare, Medicaid, and Private Payers, 1985-200260 Table 3.15Change in Nursing Home Institutionalization Rate for Elderly, 1985-199961 Table 3.16Nursing Home Resident Rate by State, 200362 Table 3.17Number of Hospital Discharges and Average Length of Stay, 1980-200463 Table 3.18Number of Physician Visits per 1,000 Persons, 1990-200064

5 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 5 Table of Contents – Section 4, Tables 4.1 to 4.20 Section 4: Public Programs65 Table 4.1Public Payers’ Share of National Health Spending, 1980-201066 Table 4.2Personal Health Care Expenditures by Type of Service and Percent Medicare Paid, 200467 Table 4.3Personal Health Care Expenditures by Type of Service and Percent Medicare Paid, 198068 Table 4.4Where the Medicare Dollar Went, 1980 and 200569 Table 4.5Medicare Trustees Report: Part A Income and Expenses, 1970-201570 Table 4.6Number of Medicare Beneficiaries, 1970-204071 Table 4.7Medicare Beneficiaries as a Share of the US Population, 1970-203072 Table 4.8Medicare Spending for Fee-For-Service Beneficiaries by Income, 200373 Table 4.9Living Arrangements of Medicare Beneficiaries, 200374 Table 4.10Age and Gender of the Medicare Population, 200375 Table 4.11Total Health Care Spending for Medicare Beneficiaries, 200376 Table 4.12Sources of Payment for Medicare Beneficiaries’ Medical Services, 200377 Table 4.13Sources of Payment for Medicare Beneficiaries by Type of Service, 200378 Table 4.14 Types of Supplemental Health Insurance held by Fee-for-Service Medicare Beneficiaries, 200379 Table 4.15 Medicare Beneficiary Out-Of-Pocket Spending, 200380 Table 4.16 Per Capita Out-Of-Pocket Expenses for Medicare Beneficiaries by Type of Insurance Coverage, 1993 and 200381 Table 4.17Distribution of Medicare Enrollees by Functional Status, 200382 Table 4.18Beneficiaries with Poor Health or Functional Limitations by Insurance Status, 200383 Table 4.19Medicare Managed Care Enrollment, 1990-200584 Table 4.20Medicare Beneficiaries with Prescription Drug Coverage,1992-200385

6 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 6 Table of Contents – Section 4, Tables 4.21 to 4.40 Section 4: Public Programs65 Table 4.21Total Spending for Prescription Drugs for all Medicare Beneficiaries, 1996-200386 Table 4.22Medicare Beneficiaries with Drug Coverage by Primary Source of Supplemental Coverage, 1995 and 200387 Table 4.23Personal Health Expenditures by Type of Service and Percent Medicaid Paid, 200488 Table 4.24Personal Health Expenditures by Type of Service and Percent Medicaid Paid, 198089 Table 4.25Medicaid Enrollment by Eligibility Group, 200390 Table 4.26Average Medicaid Payments Per Person Served by Eligibility Group, 1985-200391 Table 4.27Medicaid Enrollees by Eligibility Group, 1975-200392 Table 4.28Total Medicaid Expenditures by Type of Service, FY 200593 Table 4.29Total State Spending and Federal Funds Provided to States, 200494 Table 4.30Medicaid Spending for Long-Term Care, 1999-200395 Table 4.31Births Financed by Medicaid as Percent of Total Births by State, 200596 Table 4.32Medicaid Enrollment by Age, Sex, and Ethnicity, 200397 Table 4.33Medicaid Managed Care Enrollment, 1996-200498 Table 4.34Health Insurance Coverage of Children, 1988-200599 Table 4.35State Children’s Health Insurance Program Spending and Enrollment, 1998-2004100 Table 4.36State Children’s Health Insurance Program Plan By State, 2006101 Table 4.37State Health Spending as a Percent of Gross State Product, 2004102 Table 4.38Share of State Health Spending Financed by Medicare and Medicaid, 2004103 Table 4.39Share of State Health Spending Financed by Medicare, 2004104 Table 4.40Share of State Health Spending Financed by Medicaid, 2004105

7 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 7 Table of Contents – Sections 5 and 6 Section 5: Private Health Insurance106 Table 5.1Health Spending From Out-of-Pocket and Private Health Insurance, 1980-2010107 Table 5.2 Changes in Employer Health Insurance Premiums, Overall Inflation, and Workers' Earnings, 1989-2005108 Table 5.3Change in Health Insurance Premiums by Firm Size, 1988-2005109 Table 5.4Employee Contributions to Health Insurance Premiums, 1988-2005110 Table 5.5Average Annual Premium Costs by Plan Type, 2005111 Table 5.6Changes in Employee Benefit Packages, 1980-2004112 Table 5.7Firms Offering Health Insurance Coverage by Firm Size, 1996-2005113 Table 5.8Number of Health Plans Offered by Firm Size, 2005114 Table 5.9Private Health Insurance Enrollment by Plan Type, 1988-2005115 Table 5.10Employees With a Choice of Health Plans, 1988-2005116 Table 5.11Covered Employees in Firms that Offer Health Benefits, 2005117 Section 6: Uninsured118 Table 6.1Out of Pocket Spending by the Under 65 Population by Insurance Status by Income, 2001 and 2003119 Table 6.2 Out of Pocket Spending by the Under 65 Population by Insurance Status by Type of Service, 2001 and 2003120 Table 6.3Percent Uninsured within Age Categories, 1987-2005121 Table 6.4Percent Uninsured within Income Categories, 1987-2005122 Table 6.5Percent Uninsured by Ethnicity, 1987-2005123 Table 6.6The Uninsured by Age, 1987-2005124 Table 6.7The Uninsured by Income, 1987-2005125 Table 6.8The Uninsured by Ethnicity, 1987-2005126 Table 6.9The Uninsured by State, 2005127 Table 6.10Impact on Non-Elderly Adults of Being Uninsured, 2006128

8 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 8 Section 1 Overview of the U.S. Health Care System

9 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 9 Table 1.1 National Health Expenditures and Their Share of Gross Domestic Product (GDP), 1980-2015 Source: CMS, Office of the Actuary, National Health Statistics Group. Actual Projected National health spending is projected to continue to increase as a share of GDP over the next decade.

10 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 10 Table 1.2 National Health Expenditures Per Capita, 1980-2015 Calendar Year Source: CMS, Office of the Actuary, National Health Statistics Group. ActualProjected National health spending per capita is projected to increase rapidly over the next decade.

11 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 11 Table 1.3 Personal Health Care Expenditures by Source of Funds: Selected Years 1960-2004 Source: CMS, Office of the Actuary, National Health Statistics Group. Total Private Total Public $23.3$63.1$214.5$609.3$1,553 Over the last several decades, both the public and private sector share of health spending has increased, while the share from out-of-pocket spending has declined. 55%40% 27% 23% 14% 21% 16% 12% 10% 12% 21% 22% 28% 33% 35% 2% 3% 4% 5% 12% 17%18% 17% 8% 12% 11% 16% Dollars in Billions Other Public Medicare Total Medicaid, SCHIP expansion and SCHIP Out-of-Pocket Other Private Private Health Insurance 13% 7% 35% 13% 17% 16% $1,877.6

12 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 12 Table 1.4 Health Insurance Coverage for the Under 65 Population, 1980-2004 Notes: ESI - Employer Sponsored Insurance. Any Private includes ESI and individually purchased insurance. Any government includes Medicare for the disabled population. Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments. Over the last two decades, private coverage has declined, public coverage (mostly Medicaid) has increased a small amount, and the uninsured have grown. ESI Any Private Medicaid Any Government Uninsured

13 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 13 Table 1.5 Personal Health Care Expenditures by Type of Service, 1960-2003 Service Percent Source: CMS, Office of the Actuary, National Health Statistics Group. 39.3% 47.3% 41.7% 36.5% 22.9% 21.9% 25.9% 25.3% 0.2% 1.1% 2.1% 2.9% 11.4% 5.6% 6.6% 10.8% 3.6% 8.2%8.6%8.2% 22.5% 15.8% 15.2% 16.4% The share of health spending on prescription drugs has grown since 1980. Physician share has stayed about the same while the hospital share grew and then declined. 35.8% 25.7% 7.7% 12.4% 2.8% 15.6%

14 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 14 Table 1.6 Annual Percent Change in Personal Health Care Expenditures for Medicare, Medicaid and Total: 1971-2015 Percent Calendar Year Source: CMS, Office of the Actuary, National Health Statistics Group. Medicare Prospective Payment System (1983 ) Projected Balanced Budget Act (1997) Balanced Budget Refinement Act (1999) Actual Medicare Catastrophic Coverage Act of 1988 While the actual percent changes vary, overall spending for Medicare and Medicaid tend to rise and fall together. Medicare Extended to Disabled & ESRD (1973) Medicaid Taxes & Donations (1991) PHCE Medicare Medicaid PHCE (projected) Medicare (projected) Medicaid (projected)

15 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 15 Table 1.7 Average Annual Growth in Medicare and Private Health Insurance Benefits Per Enrollee : Selected Periods Source: CMS, Office of the Actuary, National Health Statistics Group. Entire PeriodSelected Calendar Year Periods Except for 1993-1997, Medicare has grown slightly more slowly than private health insurance. Calendar Years 1970-2004 1970-19931993-19971997-19991999-2004

16 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 16 Table 1.8 Concentration of Health Spending, 1987-2002 Source: Yu, William W. & Trena M.Ezzati-Rice, Medical Expenditure Panel Survey Statistical Brief #81, AHRQ, May 2005. Health spending remains highly concentrated on a small percentage of people. The top 1% of people account about a quarter of all health spending, Population Ranked By Expenditures Percentage of Expenditures

17 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 17 Table 1.9 Factors Accounting for Growth in Prescription Drug Spending per Capita, 1980-2011 Note: Utilization also includes the effects of intensity and population growth. Per capita drug spending in 1990 was $252 * Without the effect of Part D, overall growth would be 8.1% (price: 3.8%, Utilization 4.3%) Source: CMS, Office of the Actuary, Health Affairs Web Exclusive, Exhibit 6, pp. W70 10.7% 12.3% 8.2% 8.0% 8.1% 7.7% 8.3% * Drug Prices and Utilization significantly affect prescription drug spending per capita.

18 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 18 Table 1.10 Prescription Drugs Expenditures by Source of Funds, 1965-2004 Note: Percentages may not sum to 100 due to rounding. Drug spending grew from $3.7 billion in 1965 to $188.5 billion in 2004 Source: CMS, Office of the Actuary, National Health Statistics Group. The share of drug spending covered by public and private sources has grown significantly.

19 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 19 Table 1.11 Sources of Payment for Nursing Home and Home Health Care, 2004 Most such care is paid for by Medicare and Medicaid. Source: CMS, Office of the Actuary, National Health Statistics Group. Out-of-Pocket 29.6% Private LTC Ins. 8.4% Medicaid 47.3% Medicare 14.8% Medicaid 34% Private LTC Ins. 12.9% Out-of-Pocket 12.3% Medicare 40.8% Total nursing home and home health care spending in 2004 is $148 Billion Nursing HomeHome Care

20 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 20 Table 1.12 Number of People Employed in Health Care, 1990-2005 Note: Not seasonally adjusted. Health Care Employment includes those who work in ambulatory health care services, hospitals, and nursing and residential care facilities. Source: Kaiser Family Foundation, Trends and Indicators in the Changing Health Care Marketplace, 2006 Chartbook. Number of people employed in health is growing. Health Services Employment as a % of Non-Farm Private Sector Employment 7.5% 1990 8.0% 1991 8.2% 1992 8.3% 1993 8.3% 1994 8.4% 1995 8.4% 1996 8.4% 1997 8.4% 1998 8.3% 1999 8.2% 2000 8.5% 2001 8.8% 2002 9.1% 2003 9.2% 2004 9.2% 2005

21 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 21 Table 1.13 Health Care Employment by Occupation, 1983-2005 Source: Dept. of Labor, Bureau of Labor Statistics. Occupational Employment Statistics. Health care employment growth varies by occupation. Percent Change 1990-05 72.3% -67.4% 139.4% 0.8% 11.8% -23.5% 150.9% 151.9% 26.1% -23.9% -24.1% 46.2% 33.6% 80.8% -9.5% -24.6% -17.1% -57.1% 485.7%................................................................................................................................................................................................................................................................................................................................................................................................................

22 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 22 Table 1.14 Health Care Employment Growth Projections, 2000-2010 *Note: Five of the nation’s top 10 fastest growing occupations are in health care. Source: Dept. of Labor, Bureau of Labor Statistics. Monthly Labor Review. November 2001. Over the next decade, health care employment is expected to grow at a rapid rate. General Health Care Occupations Fastest Growing* Specific Health Care Occupations

23 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 23 Table 1.15 Average Annual Salaries for Selected Groups of Workers, 2005 Source: National Compensation Survey: Occupational Wages in the US, June 2005. US Department of Labor, July 2006. Health professionals earn higher than average incomes. Health Professionals Professional, Technical, Specialty Workers All Workers

24 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 24 Table 1.16 HMO Enrollment by Ownership Status, 1981-2004 Note: HMO enrollment includes enrollees in both traditional HMOs and point-of-service (POS) plans through: group/commercial plans, Medicare, Medicaid, the Federal Employees Health Benefits Program, direct pay plans, supplemental Medicare plans, and unidentified HMO products. Source: Kaiser Family Foundation. Trends & Indicators in the Changing Health Care Marketplace, 2006 Chartbook. The proportion of HMO enrollees in not-for-profit plans stabilized in 1997. Total HMO enrollment in 2004 = 66.1 Million

25 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 25 Table 1.17 Concentration of Managed Care Enrollment, 1988-2003 *Note: The decrease in concentration does not represent a decline, but rather a change in the methodology. Note: The largest national managed care firms include Kaiser Foundation Health Plans, UnitedHealth Group, WellPoint Health Networks, Aetna, and Health HMO enrollment includes enrollees in both traditional HMOs and point of service plans. Source: Kaiser Family Foundation. Trends & Indicators in the Changing Health Care Marketplace, 2005 – Chartbook. Half of managed care enrollees are enrolled in the nation’s 10 largest managed care firms. *

26 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 26 Table 1.18 Managed Care Enrollment by Type of Plan, 1984-2004 Note: Plans analyzed are comprehensive HMO plans. Traditional HMOs and point of service plans are included, managed care carveouts for selected services such as behavioral health are not included. Enrollment includes group and commercial plans, Medicare, Medicaid, Federal Employee group health program, and others. Source: Kaiser Family Foundation, Trends & Indicators in the Changing Health Care Marketplace, 2006 Chartbook. Mixed model HMO plans grew rapidly before 2000 and declined less rapidly after 2000. 31.4 38.8 63.3 78.9 15.1 NA 19.5% 23.3% 43.6% 13.6% NA 43.0% 18.0% 25.4% 13.6% 17.3% 41.7% 10.0% 24.8% 6.2% 36.4% 43.4% 5.3% 13.7% 1.2% 40.0% 41.9% 8.9% 8.8% 0.4% Mixed IPA Network Group Staff 38.4% 40.2% 11.2% 9.9% 0.2% 66.1 43.7% 32.6% 12.5% 11% 0.3% 74.2

27 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 27 Those over 65 and those with incomes under $20,000 spend a higher percentage of their income on health than other groups. Source: Dept. of Labor, Bureau of Labor Statistics, Consumer Expenditure Survey. Table 1.19 Health Care as a Percent of Income by Age, 2004 By Income LevelBy Age Group Age GroupIncome Level

28 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 28 Table 1.20 Annual Growth Rates in the Overall Consumer Price Index (CPI) and Medical-Specific Consumer Price Index (MCPI), 1993-2005 Source: Dept. of Labor, the Bureau of Labor Statistics. Medical prices have risen faster than overall consumer prices. MCPI CPI

29 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 29 Section 2 International Comparisons

30 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 30 Table 2.1 Percent of GDP Spent on Health Care by OECD Country, 1960-2004 *For 1960, no data was available. **2003 data was used because 2004 were not available. Note: The data is arrayed by spending growth from 1990 to 2004. The medians include all OECD countries. Source: OECD Health Data 2006. The U.S. has had a higher share of GDP spent on health than the OECD median for the past four decades. Median: 3.9% 5.1% 6.8% 7.5% 9.6 %

31 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 31 Table 2.2 Per Capita Spending on Medical Services by OECD Country, 1980-2004 * 2003 Data Used for Germany and Japan Source: OECD Health Data, 2006 US spending is growing rapidly compared with other OECD countries.

32 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 32 Table 2.3 Average Annual Growth in Per Capita Spending by Decade by OECD Country, 1960-2003 ^ Average annual change calculated from 2000-2002 Note: Each bar represents the average annual nominal growth over the decade. The data is arrayed by spending growth from 1990 to 1999. The medians include all OECD countries. Source: OECD Health Data 2005. Health spending growth over the last decade is lower in OECD countries than in prior decades.

33 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 33 Table 2.4 Per Capita Health Spending by Type of Service by OECD Country, 2003 Source: OECD Health Data 2006. Per capita outpatient spending in the US is almost double inpatient spending. In other OECD countries per capita inpatient spending is greater than outpatient spending. *

34 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 34 Table 2.5 Share of Total Health Spending on Out-Patient Care by OECD Country, 1970-2003 Source: OECD Health Data 2006 In 2003, the U.S. spent the highest percent of total healthcare spending on out- patient care; In 1970 Japan spent an even higher percent of total health care spending on outpatient care

35 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 35 Table 2.6 National Health Spending by Source of Funds by OECD Country, 2003 Source: OECD Health Data 2006 Source of funding varies significantly by country. For instance, out-of-pocket spending ranges from 8% to 18% of health spending, with the U.S. at about the median.

36 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 36 Table 2.7 Per Capita Spending on Pharmaceuticals and Other Non-Durables by OECD Country, 1970-2003 Expenditures in U.S. dollars using purchasing power parity rates. Note: Data is arrayed by spending levels for 2003. Japan not available for 1970. Source: OECD Health Data 2006. Variation across countries is increasing. Recent growth in North America is most rapid. *

37 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 37 Table 2.8 Drug Spending as a Percentage of Total Health Spending by OECD Country, 1980-2003 *2003 data for Japan is not available; 2002 was used Source: OECD Health data, 2006. Although, recent drug spending in the United States on this measure has grown, it is still low compared to other OECD countries

38 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 38 Table 2.9 Infant Mortality Rates per 1,000 Live Births by OECD Country, 1970-2004 Note: The median includes all OECD countries. The decrease from 1960-2004 is in percentage points. 2003 data used for Canada and the United States as the latest available. Source: OECD Health Data 2006. OECD country infant mortality rates have declined since 1970. United States Median Canada France Japan

39 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 39 Table 2.10 Male and Female Life Expectancy at Birth by OECD Country, 1960-2004 *2003 data was used because 2004 was not available. Note: Data are arrayed by male life expectancy; countries are kept together. The medians include all OECD countries. Source: OECD Health Data 2006 MaleFemale Median = 67.2 70.0 76.4 Median = 72.5 76.6 81.4 * Japan has the highest life expectancy at birth for both males and females.

40 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 40 Table 2.11 Male and Female Life Expectancy at Age 65 by OECD Country, 1960-2004 Note: Data are arrayed by male life expectancy; countries are kept together * 2003 data **Data are 2001 for females and 2002 for males. Source: OECD Health Data 2006. Male Female Japan has the highest male and female life expectancy

41 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 41 Table 2.12 Number of In-Patient Discharges and Total Beds per 1,000 Persons by OECD Country, 2004 Discharge rates generally track bed supply. Source: OECD Health Data 2006 * 2004 data not available, used 2003. Discharges/1000 Number of beds/1000

42 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 42 *2003 Data.; **2002 data ***no data available Countries are listed alphabetically. Data Expressed in Days Source: OECD Health Data 2006. Table 2.13 Average Length of Hospital Stay For Selected OECD Countries, 2004 Average Length of Stay- In-Patient Acute Average Length of Stay- Appendicitis* The length of stay for specific procedures varies differently from total length of stay

43 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 43 Table 2.14 Medical Technology and Use of High-Technology Medical Procedures by OECD Country, 2004 *2003 data,**2002 data, ***2001 data, ****2000 data, *****earlier data. Medians reflect all OECD countries Source: OCED Health Data 2006 MRIs per Million People CT Scanners per Million People Coronary Bypass Procedures per 100,000 People Coronary Angioplasty Procedures per 100,000 People Patients Undergoing Dialysis per 100,000 People Bone Marrow Transplants per 100,000 People Australia3.720.8*****77.9*153.0*39.55.6* Austria14.928.554.6*174.8****43.74.6 Canada4.910.397.6*167.4***56.43.9*** Denmark10.214.560.0*156.9*45.10.7***** France3.27.540.8***155.9****26.2*****6.9 Germany6.615.486.5301.673.94.8 Greece2.3**17.1**59.6*****122.9**75.41.9 Hungary2.66.8135.5235.849.62.8 Italy10.220.646.5*92.4*34.4*****7.1* Japan35.3**92.6**__194.30.9 Mexico1.73.12.31.537.20.1 Netherlands3.9*****9*****58.292.6*28.2*****3.6 Poland1*6.3*8*****19*****……2.1* Spain7.713.329.9*58.5*49.34.6 Sweden7.9*****14.2*****75.1*144.0*25.5*****2.0*** Switzerland14.317.932.685.626.5*****1.7 United Kingdom5.07.055.5113.441.64.2 United States….. 160.7*426.4*159.5*5.1* Median6.0*14.0*60.0*158.5*45.1*2.9* Different countries spend health dollars in different ways: Japan has the highest rate of diagnostic high-tech procedures, the U.S. has the highest rate of heart procedures.

44 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 44 Table 2.15 Selected Indicators of Morbidity by OECD Country, Selected Years *2003, **2002, ***2001, ****2000, *1999 or earlier Median includes all OECD countries. Source: OECD Health Data 2006. 2002 Incidence of Cancer (All Types of Malignant Neoplasms) per 100,000 2004 Incidence of AIDS in Population, per 1,000,000 2004 Total Surgeries on an In-patient Basis, per 1,000 2004 Percentage of Population That is Obese (BMI >30) 2004 Percentage of Population That are Daily Smokers 2004 Percentage of Total Live Births That are Low- birthweight Births Australia312.012.050.2*21.7*****17.76.3* Austria275.58.2133.6*9.1*****36.3*****6.8 Canada299.99.444.8*122.415.05.8* Denmark281.49.997.49.5****26.05.3 France289.523.4*_9.523.06.8 Germany283.36.0*79.412.9*24.3*6.9 Greece203.06.8_21.9*38.68.6 Hungary318.82.3228.618.8*30.1*8.3 Italy276.529.252.7*8.0*24.2*6.7* Japan214.53.0_3.2*29.49.4 Mexico147.345.3*31.324.2****26.4**9.1 Netherlands283.012.139.810.930.05.4** Poland256.14.9__27.6****5.1 Spain243.443.051.9*13.1*28.1*7.1 Sweden264.77.554.6**9.816.24.2 Switzerland284.64.8103.97.7**26.8**6.5 United Kingdom273.614.163.323.0*25.07.6* United States357.7149.089.930.6**17.08.1 Median266.29.952.7*12.9*26.55.1 Risky behaviors vary significantly by country: the U.S. has higher rates of obesity and HIV; Western Europe has higher rates of smoking and in some countries, surgery.

45 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 45 Table 2.16 Selected Indicators of Mortality by OECD Country, 2004 Median includes all OECD countries. *2003 data;**2002data;***2001data,****earlier data Source: OECD Health Data 2006. Cancer Mortality Rates, per 100,000 Suicide Rates for Total Population, per 100,000 Homicide Rates for Total Population, per 100,000 Homicide Rates for Males, per 100,000 HIV Mortality Rates for Total Population Due to HIV Infection, per 100,000 Australia161.011.1**1.4**1.9***0.5** Austria161.414.50.7 0.5 Canada173.2**10.6**1.5**2.0**1.0** Denmark212.5****11.3***.8***1.1***0.5*** France172.7**15.1***0.8**.9**1.4** Germany161.210.30.60.70.5 Greece152.4*2.9*1.0*1.5*0.2* Hungary244.8*22.6*1.8*2.2*0.1* Italy167.3**5.6**0.9**1.3**0.0** Japan146.5**20.3*0.15*0.6*0.4* Mexico114.2****_20.1****37.8****_ Netherlands182.27.91.11.60.4 Poland202*13.6*1.42.0*0.3* Spain158.*6.7*0.9*1.4*3.2* Sweden148.8**11.4**1.1** 0.3** Switzerland144.1**15.3**0.9**0.8**1.1** United Kingdom181.8**6.3**1.2** 0.3** United States166.3**10.2**6.2**9.7**4.2** Median166.0**11.5**1.2**1.5**0.35** Causes of mortality differ: the U.S. and Mexico have high homicide rates, Japan and Europe have high suicide rates.

46 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 46 Section 3 Providers

47 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 47 Table 3.1 Number of Hospitals by Type, 1980-2004 *Includes specialty hospitals such as TB, Ob-Gyn; eye, ear, nose and throat; orthopedic and chronic disease. Source: American Hospital Association, personal communication, 2006. General All Hospitals Psychiatric Fed General Total Other* Fed Psych Rehabilitation Pediatric Specialty Hospitals The number of hospitals has declined with the exception of rehabilitation hospitals.

48 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 48 Table 3.2 Number of Hospital Beds and Occupancy Rates by Hospital Type, 1980-2004 The decline in the percentage of general hospital beds is greater than the percentage decline in occupancy rates in general hospitals. Occupancy Rate *Includes specialty hospitals such as TB, Ob-Gyn; eye, ear, nose and throat; orthopedic and chronic disease. Source: American Hospital Association, personal communication, 2006. General All Hospitals Psychiatric General Total Other* Rehabilitation Pediatric Beds

49 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 49 Table 3.3 Number of Hospital Beds per 1,000 Persons by State, 2004 Note: Per 1,000 population. Source: 2004 AHA Annual Survey. Kaiser Family Foundation State Health Facts Online. Medium (2.6-3.9) High (4.0 - 6.5) Low (1.8-2.5) WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD National average is 3 The number of hospital beds varies by state, with the lowest concentration in the Western U.S.

50 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 50 Table 3.4 Number of Nursing Home Beds and Total Residents, 1985-2003 Source: Health, United States, 2005, National Center for Health Statistics. From 1985 to 1999 beds grew slightly more rapidly than residents, after 1999, resident counts fell more rapidly than the bed count.

51 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 51 Table 3.5 Number of Physicians per 100,000 Persons by State, 2004 Note: Includes non-federal physicians only. Source: Physician Characteristics and Distribution in the U.S. 2004. American Medical Association. Kaiser Family Foundation State Health Facts Online. Medium (241 - 290) High (291 - 752) Low (175-240) WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD National average is 281 Availability of Physicians varies substantially by state, with the highest concentration in the Northeast.

52 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 52 *Projection for 2000. Note: Includes all active physicians. Source: AMA data from the Bureau of Health Professions and Health, United States, 1993. Since 1950, urban areas have seen much more rapid growth in physicians than rural areas. * Table 3.6 Distribution of Active Physicians, 1950-1998

53 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 53 Table 3.7 Percentage of Physicians in Differing Practice Arrangements, 1987-2001 Source: AMA Socioeconomic Monitoring System and 2001 Patient Care Physician Surveys, American Medical Association Declines in solo practice physicians are offset by increases in salaried physicians and group practices.

54 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 54 Table 3.8 Physician Revenue by Payer, 1986-2004 The share of physician and clinical services revenue paid by patients out-of-pocket has declined substantially since 1986. Private health insurance continues as the largest source of physician and clinical services revenue. Total Private Total Public $99.5 billion Other Public Medicare Total Medicaid, SCHIP expansion and SCHIP Out-of-Pocket Other Private Private Health Insurance $157.5 billion$220.5 billion$286.4 billion Source: CMS, Office of the Actuary, National Health Statistics Group. $399.9 billion

55 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 55 Table 3.9 Physician Participation in Managed Care, 1988-2001 Note: Managed care contracts include HMOs, IPA, and PPOs. Data from the American Medical Association. Source: Trends and Indicators in the Changing Health Care Marketplace, 2005, Kaiser Family Foundation. Most physician practices have managed care contracts and receive a significant share of revenue from them. % %

56 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 56 Table 3.10 Physician Managed Care Payment Arrangements, 2001 Note: Physicians may receive payment in multiple ways, so the payment methods do not add to 100%. Source: Trends and Indicators in the Changing Health Care Marketplace, 2005, Kaiser Family Foundation. Fee-for-Service is the predominant payment arrangement for physicians.

57 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 57 Table 3.11 Hospital Participation in HMOs and PPOs, 1987-2004 Source: American Hospital Association, personal communication. A steady rise in the number of hospitals participating in both Health Maintenance and Preferred Provider Organizations has leveled off in recent years.

58 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 58 Table 3.12 Hospital Managed Care Payment Arrangements, 2001 Source: Trends and Indicators in the Changing Health Care Marketplace, 2005, Kaiser Family Foundation. Most hospitals receive per diem and fee-for-service payments, a much smaller number also receive capitated payments.

59 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 59 Table 3.13 Hospital Profit Margins for All Payers and Medicare, 1997-2004 Source: CMS, Office of the Actuary. Medicare cost report data. For both rural and urban hospitals, overall and Medicare inpatient hospital profit margins have declined. Total margins remain positive. Total MarginsMedicare Inpatient Margins

60 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 60 Table 3.14 Hospital Payment to Cost Ratios for Medicare, Medicaid, and Private Payers, 1985-2002 Source: American Hospital Association Annual Survey. Chapter 4. Trends in Hospital Financing Private Payers continue to pay a larger share of hospital costs than Medicare and Medicaid but less so than in the late eighties and early nineties.. Private Payers 119% Medicare 97.9% Medicaid 96.1%

61 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 61 Table 3.15 Change in Nursing Home Institutionalization Rate for the Elderly, 1985-1999 Source: Health, United States, 2005, National Center for Health Statistics. While the absolute number of elderly in nursing homes continues to rise, the number of residents per 1,000 elderly has declined. Total Number of Elderly in Nursing Homes Rate of Elderly in Nursing Homes per 1,000 Elderly

62 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 62 Table 3.16 Nursing Home Resident Rate by State, 2003 Note: Number of nursing homes residents (all ages) per 1,000 resident population 85 years of age and over. Source: Health, United States, 2005. Table 116. Medium (300 - 400) High (400+) Low (131 - 299) WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD National average is 308 The Western U.S. houses the smallest share of nursing home residents.

63 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 63 Table 3.17 Number of Hospital Discharges and Average Length of Stay, 1980-2004 Note: Non-Federal short-stay hospitals. Source: Center for Disease Control and Prevention, National Center for Health Statistics. Hospital discharges and length of stay have generally declined over the last two decades.

64 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 64 Table 3.18 Number of Physician Visits per 1,000 Persons, 1990-2000 Source: Center for Disease Control and Prevention, National Center for Health Statistics. While there was a drop in the overall number of physician visits during the early nineties, by 1996-97, visits steadily increased.

65 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 65 Section 4 Public Programs

66 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 66 Table 4.1 Public Payers’ Share of National Health Spending, 1980-2010 The share of national spending by public payers has increased slightly over the last two decades, driven by faster growth in Medicare and Medicaid spending. Note: Total public includes Medicare, Medicaid, other federal (not shown) and state and local spending. *2010 is a projection. Source: CMS, Office of the Actuary, National Health Statistics Group.

67 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 67 Total personal health care spending in 2004 was $1.56 trillion; Medicare accounted for over 19%. $570.8 Billion Medicare pays 28.6% $399.9 Billion Medicare pays 20.5% $188.5 Billion Medicare pays 1.8% $115.2 Billion Medicare pays 13.9% $52.7 Billion Medicare pays 19.2% $81.5 Billion Medicare pays 0.1% $53.3 Billion Medicare pays 0% $32.3 Billion Medicare pays 5.9% $43.2 Billion Medicare pays 37.9% $23 Billion Medicare pays 28.3% 1 Medicare payments are mostly from managed care plans, since fee-for-service Medicare did not generally cover outpatient prescription drugs in 2004. Source: CMS, Office of the Actuary, National Health Statistics Group. 1 Table 4.2 Personal Health Care Expenditures by Type of Service and Percent Medicare Paid, 2004

68 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 68 Table 4.3 Personal Health Care Expenditures by Type of Service and Percent Medicare Paid, 1980 Total personal health spending in 1980 was $214.6 billion; Medicare accounted for 17% $13 Billion Medicare pays 0% $101 Billion Medicare pays 26% $47 Billion Medicare pays 17% $12 Billion Medicare pays 0% $17 Billion Medicare pays 2% $3 Billion Medicare pays 8% $3 Billion Medicare pays 0% $2 Billion Medicare pays 27% $9 Billion Medicare pays 0% $3 Billion Medicare pays 8% Source: CMS, Office of the Actuary, National Health Statistics Group.

69 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 69 Table 4.4 Where the Medicare Dollar Went: 1980 and 2005 1 Other services include other professional services and ambulance services. Note: Data do not sum due to rounding. Spending includes benefit dollars only. Source: CMS, Office of the Actuary, Trustees Report 2006 Outpatient Hospital and Other Outpatient Facility 1 SNF Physician Inpatient Hospital HHA Total = $336 Billion Medicare spending has moved from inpatient hospital services to all other settings. Managed care has grown while the physician share declined. Total = $37 Billion 20051980 Inpatient Hospital SNF Home Health Care Physician Managed Care Other Administrative Expenses

70 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 70 Table 4.5 Medicare Trustee’s Report: Part A Income and Expenses, 1970-2015. Source: CMS, Office of the Actuary.Trustees Report, 2006. ActualProjected Projected Expenditures First Exceed Projected Income in 2011

71 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 71 Table 4.6 Number of Medicare Beneficiaries, 1970-2040. Source: Medicare Trustees Report 2006 Enrollment in the Medicare Program is projected to nearly double in the next 30 years. Enrollment (millions) ActualProjected

72 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 72 Table 4.7 Medicare Beneficiaries as a Share of the U.S. Population, 1970-2030 The U.S. population will age rapidly through 2030, when 22 percent of the population will be eligible for Medicare. Source: Social Security Administration, Office of the Actuary. 12.1% 9.5% 13.1% 13.9% 15.0% 18.5% 22.0% 10.89.511.912.012.615.819.5 1.3 1.2 1.9 2.4 2.7 2.4 Total Number of Medicare Beneficiaries: (millions) 20.4 28.4 34.3 39.6 46.5 61.6 78.6

73 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 73 $5,000 or Less 4% $5,001 - $10,000 25% $10,001 - $15,000 17% $15,001 - $25,000 24% $25,001 - $40,000 16% $40,001 or More 14% About seventy percent of Medicare expenditures are on behalf of individuals with annual incomes of $25,000 or less. Note: Data may not sum due to rounding. Source: CMS, Office of Research, Development, and Information: Data From the Medicare Current Beneficiary Survey (MCBS) 2003 Access to Care File. Table 4.8 Medicare Spending for Fee-for-Service Beneficiaries by Income, 2003

74 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 74 Source: CMS, Office of Research, Development, and Information: Data from the Medicare Current Beneficiary Survey (MCBS) 2003 Access to Care File. Among the nearly 30 percent of beneficiaries living alone, a large proportion are women and have low incomes. Live with Spouse 49% Live in LTC Facility 5% Live with Children/Others 17% Live Alone 29% 52% have an income <$15,000 70% are women 16% are over the age of 85 $ 85+ Table 4.9 Living Arrangements of Medicare Beneficiaries, 2003

75 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 75 56% 46% 41% 29% The proportion of women increases among those 85 and older. Table 4.10 Age and Gender of the Medicare Population, 2003 53% 47% 54% 46% 58% 42% 31% 69% Note: Fifty-three percent (23.7 million) of all Medicare beneficiaries are female; 44% (18.6 million) are males. Data reflect Medicare beneficiaries ever enrolled in the program during the year. Source: CMS, Office of Research, Development, and Information: data from the Medicare Current Beneficiary Survey (MCBS) 2003 Access to Care File. 18.2 million 6.1 million 13.1 million 4.9 million Enrollees (millions)

76 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 76 Rx Drugs 13.6% ($66.7 B) Note: Premium payments are excluded. LTC is long-term care. SNF is skilled nursing facility. Source: CMS, Office of Research, Development, and Information: Data from the Medicare Current Beneficiary Survey (MCBS) 2003 Cost and Use File. Table 4.11 Total Health Care Expenditures for Medicare Beneficiaries, 2003 Total Health Care Expenditures = $491 Billion LTC 15.6% ($76.6 B) Home Health 2.7% ($13.4 B) Dental 2.4% ($12.0 B) Medical Provider 25.3% ($124.3 B) Hospital 35.4% ($173.7 B) SNF 3.6% ($17.8 B) Hospice 1.2% ($6.0 B)

77 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 77 *Beneficiary out-of-pocket spending does not include their payments for Medicare Part B premiums, private insurance premiums, or HMO premiums. Note: Data are for all beneficiaries, both fee-for-service and Medicare+Choice enrollees. Source: CMS, Office of Research, Development, and Information: Data From the Medicare Current Beneficiary Survey (MCBS) 2003 Cost and Use File. Medicare pays a little more than half of the total cost of beneficiaries’ medical care. Overall Medical Expenses per Medicare Beneficiary = $12,512 Private Insurance 13% ($1,600) Medicaid 11% ($1,321) Medicare 52% ($6,553) Other Sources 6% ($688) Direct Out-of-Pocket* 18% ($2,350) Table 4.12 Sources of Payment for Medicare Beneficiaries’ Medical Services, 2003

78 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 78 Table 4.13 Sources of Payment for Medicare Beneficiaries by Type of Service, 2003 1 OOP is out-of-pocket. 2 Other Medical includes things such as hospice and durable medical equipment. Note: Medicare did not generally cover outpatient prescription drugs in 2003. Source: CMS, Office of Research, Development, and Information: Data from the Medicare Current Beneficiary Survey (MCBS), 2003 Cost and Use File. 100 80 60 40 20 0 Percent of Expenditure by Payer Medicare pays a large proportion of the total expenses of services it covers. 1 2

79 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 79 Table 4.14 Types of Supplemental Health Insurance held by Fee-for-Service Medicare Beneficiaries, 2003 13.5% Note: Medicaid (shown above) includes both Qualified Medicare Beneficiaries (QMBs) and Specified Low-Income Medicare Beneficiaries (SLMBs). Source: CMS, Office of Research, Development, and Information: Data From the Medicare Current Beneficiary Survey (MCBS) 2003 Access to Care File. Most beneficiaries using fee-for-service Medicare have private, supplemental health plans. No Supplemental Insurance 16% Medicaid 18% Individual Medigap 26% Other 2% Employer- Sponsored 33% Medigap & Employer-Sponsored Insurance 5%

80 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 80 Table 4.15 Medicare Beneficiary Out-of-Pocket Spending, 2003 *These are for home health services not covered by Medicare. Note: 1) Data are for all beneficiaries, both fee-for-service and Medicare+Choice enrollees. 2) Total per capita direct out-of-pocket spending is $3,765 Source: CMS Office of Research, Development and Information, Medicare Current Beneficiary Survey (MCBS) 2003 Cost and Use file Total Out-of-Pocket Expenses Direct Out-of-Pocket $159 billion $99 billion The majority of beneficiary out-of-pocket spending is for Medicare cost-sharing and payment for non-covered services. Medicare Cost- Sharing 35% Outside Medicare Benefit Package 63%

81 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 81 Table 4.16 Per Capita Out-of-Pocket Expenses for Medicare Beneficiaries by Type of Insurance Coverage, 1993 and 2003 Note: Premium payments are included. Source: CMS, Office of Research, Development, and Information: Data from the Medicare Current Beneficiary Survey (MCBS), 1993 and 2003 Cost and Use Files. Beneficiaries without supplemental insurance and those with Medigap coverage have higher out-of-pocket spending than other groups. Percent Change, 1993 to 2003 63.3%79.7%46.8%74.5%44.4%107.7%

82 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 82 Note: ADLs are activities of daily living (e.g., eating, bathing); IADLs are instrumental activities of daily living (e.g., shopping, use of phone, cleaning). Source: CMS, Office of Research, Development, and Information: Data from Medicare Current Beneficiary Survey (MCBS) 2003 Cost and Use File. More than one-third of the Medicare population needs assistance with at least one “activity of daily living.” Table 4.17 Distribution of Medicare Enrollees by Functional Status, 2003 15% 14 %

83 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 83 Table 4.18 Beneficiaries with Poor Health and Functional Limitations by Insurance Status, 2003 Medicare beneficiaries in poor health or with functional limitations are more likely to receive Medicaid or to have no supplemental insurance. Source: CMS, Office of Research, Development, and Information: Data from the Medicare Current Beneficiary Survey (MCBS) 2003 Access to Care File.

84 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 84 Table 4.19 Medicare Managed Care Enrollment, 1990-2005 Source: CMS, Office of the Actuary. Managed care enrollment grew through 2000, then declined, and is now on the upswing.

85 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 85 About three-quarters of Medicare beneficiaries had prescription drug coverage at some point in 2003. Table 4.20 Percent of Medicare Beneficiaries with Prescription Drug Coverage, 1992-2003 Note: This includes beneficiaries who had some type of drug coverage at any point during the year. Does not include beneficiaries in facility care. Source: CMS, Office of Research, Development, and Information: Data from the Medicare Current Beneficiary Survey (MCBS) 1992- 2003 Cost and Use Files.

86 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 86 Table 4.21 Total Spending for Prescription Drugs for All Medicare Beneficiaries, 1996-2003 1996199719991998 Total spending for drugs was higher for beneficiaries with drug coverage than without; however, non-covered beneficiaries pay substantially more out-of-pocket costs. Note: Does not include beneficiaries in facility care. Does not adjust for underreporting of prescription drugs. Source: CMS, Office of Research, Development, and Information: Data from the Medicare Current Beneficiary Survey (MCBS) 1996- 2003 Cost and Use Files. 20002001 20022003

87 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 87 Table 4.22 Medicare Beneficiaries With Drug Coverage by Primary Source of Supplemental Coverage, 1995 and 2003 Note: Data are based on the non-institutionalized beneficiaries. Percentages shown in bars are Medicare beneficiaries with drug coverage as a percent of total Medicare beneficiaries. Beneficiaries do not necessarily get drug coverage from their primary sources of supplemental insurance. Source: CMS/Office of Research, Development and Information. Data are from the Medicare Current Beneficiary Survey. 65% of Medicare Beneficiaries Have Drug Coverage 78% of Medicare Beneficiaries Have Drug Coverage Medicare + Choice Plans Medicaid Employer- Sponsored Individually Purchased Other Employer-sponsored retiree coverage is the largest source of coverage for drug spending.

88 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 88 Table 4.23 Personal Health Expenditures by Type of Service and Percent Medicaid Paid, 2004 Total personal health spending in 2004 was $1,560,241,000,000; Medicaid accounted for 17% $81.5 Billion Medicaid pays 5% $570.7 Billion Medicaid pays 17% $399.9 Billion Medicaid pays 7% $188.5 Billion Medicaid pays 19% $115.2 Billion Medicaid pays 44% $52.7 Billion Medicaid pays 6% $43.1 Billion Medicaid pays 32% $53.2 Billion Medicaid pays 69% $32.3 Billion Medicaid pays 0% $22.9 Billion Medicaid pays 15% Source: CMS, Office of the Actuary, National Health Statistics Group.

89 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 89 Table 4.24 Personal Health Expenditures by Type of Service and Percent Medicaid Paid, 1980 Total personal health spending in 1980 was $214.6 billion; Medicaid accounted for 12%. $13 Billion Medicaid pays 4% $101 Billion Medicaid pays 10% $47 Billion Medicaid pays 5% $12 Billion Medicaid pays 12% $17 Billion Medicaid pays 50% $3 Billion Medicaid pays 5% $3 Billion Medicaid pays 13% $2 Billion Medicaid pays 12% $9 Billion Medicaid pays 0% $3 Billion Medicaid pays 0% Source: CMS, Office of the Actuary, National Health Statistics Group.

90 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 90 Table 4.25 Medicaid Enrollment by Eligibility Group, 2003 Payments for the elderly, blind and disabled account for 69 percent of total payments. Note: Expenditure distribution based on Congressional Budget Office data that includes only federal spending on services and excludes DSH payments, supplemental provider payments, vaccines for children, administration, and the temporary Federal Medicaid Assistance Percentage Increase.. Source: Kaiser Family Foundation, Trends and Indicators in the Changing Health Care Marketplace Chartbook 2004. Blind & Disabled 43% Children 19% Adults 12% Elderly 26% Children 48% Adults 27% Elderly 9% Blind & Disabled 16% Total Enrollees = 52.4 million Total Expenditures = $235 billion

91 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 91 Table 4.26 Average Medicaid Payments per Person Served by Eligibility Group, 1985-2003 Source: CMS, CMSO, HCFA-2802 reports; Medicaid Statistical Information System. Per capita payments for the elderly, blind and individuals with disabilities continue to be significantly higher than payments for other groups. $2,292 $13,303 $13,677 200319981995199019881985 $1,606

92 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 92 Table 4.27 Medicaid Enrollees and Beneficiaries by Eligibility Group, 1975-2003 Medicaid “enrollees” are those who are enrolled in Medicaid at any time during the fiscal period. “Beneficiaries” are those for whom services have been reimbursed during the fiscal period. *Note: (1) In 1998, a large increase occurred in the number of persons served which is mainly the result of a new reporting methodology of classifying payments to managed care organizations; FY 1998 was the first year capitation payments were counted as a service for purposes of the HCFA 2082 reporting, and thus all managed care enrollees were counted as individuals receiving services; this new methodology probably has the greatest effect on the reported number of children; (2) the term “adults” as used above refers to non-elderly, non-disabled adults; (3) disabled children are included in the blind & disabled category shown above. **The Other category was dropped in 1999. Source: CMS, CMSO, Medicaid Statistical Information System. Children historically represent the largest group of Medicaid enrollees. Adults 14.3 million enrollees 11.7 m beneficiaries Children Under 21 27.3 million enrollees 24.8 million beneficiaries Blind & Disabled 8.4 million enrollees 7.7 million beneficiaries Age 65 & Older 5.2 million enrollees 4 million beneficiaries Other** 2003 Total =55.2 million Enrollees

93 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 93 Table 4.28 Total Medicaid Expenditures by Type of Service, FY 2005 Source: CMS, Office of the Actuary. Expenditure (In Billions) Hospital $76 Collections -$5 Medicare Premiums $8 Dental $3.4 Prescription Drugs $30.7 Other $15 Long Term Care $95.3 Outpatient $23.9 Inpatient (General) $42 Inpatient (Mental) $4.7 Outpatient Hospital $12.3 DSH Hospital Payments $17.1 Nursing Homes $46.4 Intermediate Care Facility-MR $12.5 Community Based Long Term Care $36.4 Capitation Payments $50.6 Targeted Case Management $3 EPSDT $1.1 Lab & Radiology $1.3 Clinic Services $9.1 Physician Services $12.4 25% 1% 10% 32% 5% 8% 3% Total Medicaid Expenditures in FY 2005 were $300.7 billion 1% 16%

94 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 94 Table 4.29 Total State Spending and Federal Funds Provided to States, 2004 Source: National Association of State Budget Officers, 2004 State Expenditure Report. Over twenty-two percent of state total spending and over forty-four percent of federal funds provided to states were spent on Medicaid. Total State SpendingFederal Funds Provided to States Higher Education 10.9% Elementary & Secondary Education 21.4% Transportation 8.0% All Other 31.7% Medicaid 22.3% Corrections 3.5% Public Assistance 2.1% Higher Education 5.6% Elementary & Secondary Education 11.4% Transportation 8.0% All Other 26.3% Medicaid 44.5% Corrections 0.6% Public Assistance 3.6%

95 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 95 Table 4.30 Medicaid Spending for Long-Term Care, 1999-2003 Notes: The share of Medicaid spending on long term care devoted to home and community based settings increased from 25% of the total in FY1999, 26% in FY2000, 29% in FY2001, 32% in FY2002, to 34% of the total in FY2003. Institutional spending includes SNF’s, ICF’s, ICF- MR, and Psychiatric Hospitals. Sources: CMS, Center for Medicaid and State Operations, MSIS data. Home and community-based services are a growing share of Medicaid’s long term care spending. $55b $59b $66b $73b $77b

96 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 96 32.0% to 39.9% 48% to 55.9% 40.0% to 47.9% Less than 32% Table 4.31 Births Financed by Medicaid as a Percent of Total Births by State, 2005 Source: Kaiser Family Foundation, State Health Facts, http://www.statehealthfacts.orghttp://www.statehealthfacts.org WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC AK CO GA MS OK NJ SD Medicaid pays for about 41% of the nation’s births. Above 56.0% HI

97 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 97 Table 4.32 Medicaid Enrollment by Age, Sex, and Ethnicity, 2003 Source: MSIS State Summary for 2003. Native Hawaiian/ Pacific Islander 1% Hispanic 21% Multiple Races/ Other 7% 21-44 Male Female Asian 3% American Indian/ Native Alaskan 1% African American 23% White 44% 19-20 85+ 75-84 65-74 45-64 There were 55.2 million Medicaid enrollees in 2003. AgeEthnicitySex 0-18

98 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 98 Table 4.33 Medicaid Managed Care Enrollment, 1996-2004 Note: The unduplicated managed care enrollment figures include enrollees receiving comprehensive benefits and limited benefits. This table also provides unduplicated national figures for the Total Medicaid population and Other population. The statistics also include individuals enrolled in State health care reform programs that expand eligibility beyond traditional Medicaid eligibility standards. Source: CMS, Center for Medicaid and State Operations: National Summary of Medicaid Managed Care Programs and Enrollment June 30, 2001. CMS, Medicaid Managed Care Enrollment Data, 2002-2004. Medicaid managed care enrollment grew rapidly over the last decade. Managed Care 40% 48% 54% 56% 56% 57% 57% 60% 61% % Enrolled in

99 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 99 Table 4.34 Health Insurance Coverage of Children, 1988-2005 *Other includes private non-group and other public insurance. A change in the census questionnaire allowed this category to be separately identified starting in 2000. see also Table 6.6 Notes: About 23% of children below poverty (or 4.1 million kids) had no health insurance in 2004. Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments. The percentage of children without health insurance has declined since SCHIP was Implemented in 1998.

100 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 100 Table 4.35 State Children’s Health Insurance Program Spending and Enrollment, 1998-2004 *Note: Ever enrolled in SCHIP during the year, not a point in time estimate. Source: Center for Medicaid and State Operations SpendingEnrollment* The SCHIP program covers a growing number of uninsured low-income children.

101 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 101 Table 4.36 State Children’s Health Insurance Program Plan Type by State, 2006 Key * Approved Unborn State Plan Amendments: 9 (AR, CA, IL, MA, MI, MN, RI, TX, WA) ^ Approved SCHIP 1115 Demonstrations: 6 (AK, MN, NM, NJ, RI, WI) + Approved HIFA Demonstrations: 13 (AZ, AR, CA, CO, ID, IL, MI, NJ, NV, NM, OR, UT, VA) # State no longer has a Medicaid expansion program as of September 30, 2002, due to the aging out of the children phased into the Medicaid program under OBRA’90. Summary Information (in order of submission/approval): Number of Approved Separate State Child Health Plans: 18 (CO, PA, OR, NV, UT, MT, GA, AZ, KS, VT, WA, WY, WV, AL, MS, TX, CT, NY) Number of Approved Medicaid Expansions: 17 (SC, OH, MO, OK, WI, PR, DC, NE, NM, VI, LA, AK, HI, GU, AS, CNMI, TN) Number of Approved Combination Plans: 21 (FL, MA, NJ, ME, NH, KY, MI, IA, NC, ND, IN, IL, MD, SD, VA, CA, RI, MN, DE, AR, ID) Total Number of Amendments Approved: 272 Number of Amendments Under Review: 13 (TN,VA-6th amend, IL-6th amend, IL-7th amend, CA-11th amend, WI-4th amend.)WV-6th-amend; FL-17th amend; PA-7th amend.; DE-3rd amend, WA-8th amend. Source: CMS Center for Medicaid andState Operations.

102 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 102 High (16.9% - 20.5%) Low (9.5% - 13.1%) Table 4.37 State Health Spending as a Percent of Gross State Product 2004 Note: Data are for personal health care by state of provider. Source: CMS, Office of the Actuary, National Health Statistics Group. WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD Proportion of state output devoted to personal healthcare varies by state. National average is 13.4% Medium (13.2% -16.8%)

103 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 103 Medium 32%-39% High 40%-51.1% Low 26% - 32% Table 4.38 Share of State Health Spending Financed by Both Medicare and Medicaid, 2004 Source: CMS, Office of the Actuary, National Health Statistics Group. WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD Medicare and Medicaid finance varying proportions of State health spending. National average is 36.6%

104 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 104 Medium 15.6%-21.8% High 21.9%-28.1% Low 7.4%-15.5% Table 4.39 Share of State Health Spending Financed by Medicare, 2004 Source: CMS, Office of the Actuary, National Health Statistics Group. WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD Medicare finances a varying share of State health spending. National average is 19.2%

105 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 105 Medium 16.7%-24.0% High 24.1%–31.6% Low 9.1%-16.6% Table 4.40 Share of State Health Spending Financed by Medicaid, 2004 Source: CMS, Office of the Actuary, National Health Statistics Group. WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC KY FL VA OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD Medicaid finances a varying share of State health spending. National average is 17.4%

106 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 106 Section 5 Private Health Insurance

107 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 107 Table 5.1 National Health Spending From Out-of-Pocket and Private Health Insurance, 1980-2010 Over the last 25 years, the share of national health spending from out-of-pocket sources has declined, while that from private health insurance has increased. *Projected Note: The remainder of national health spending is from public sources. This chart is a subset off Table 1.3 Source: CMS, Office of the Actuary, National Health Statistics Group.

108 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 108 Table 5.2 Changes in Employer Health Insurance Premiums, Overall Inflation, and Workers’ Earnings, 1989-2005 The rate of increase in employer health insurance premiums is slowing. Source: Health Insurance Premiums from personal communication of data from KFF/HRET Employer Health Benefits Surveys from 1999, 2000, 2001, 2005: KPMG Survey of Employer-Sponsored Health Benefits: 1993, 1996; HIAA Employer-Sponsored Health Insurance Survey; 1989. Workers’ Earnings from Bureau of Labor Statistics Current Employment Statistics Survey (April-April), 1988-2001. Overall Inflation from Bureau of Labor Statistics, CPI estimates (April-April), 1988-2001, at www.bls.gov. Trends and Indicators in the Changing Health Care Marketplace, 2002 – Chartbook.

109 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 109 Table 5.3 Annual Change in Health Insurance Premiums by Firm Size, 2005 29% Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 2005. Small firms face higher premium growth than larger firms.

110 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 110 Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 2000, 2001, 2003, 2005; KPMG Survey of Employer- Sponsored Health Benefits: 1988, 1993, 1996. Table 5.4 Employee Contributions to Health Insurance Premiums, 1988-2005 Employees are paying a higher dollar value, but smaller share of their health insurance premiums. Percentage of Premium Paid by Employees, 1988-2005 Average Monthly Employee Contribution, 1988-2005

111 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 111 Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 2005. Average premiums vary by plan type. Table 5.5 Average Annual Premium Costs by Plan Type, 2005 All Plans Conventional FFS HMO PPO POS

112 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 112 Table 5.6 Changes in Employee Benefit Packages, 1980-2004 Note: Coverage for selected services offered by medium and large establishments, displayed by % of employees that have each benefit available to them. **Not available. 2004 data available only for physical exams and well baby exams. Sources: Dept. of Labor, Bureau of Labor Statistics. Report by Sophie Korczyk, “Trends in Employer-Provided Health Care Coverage: 1980-1997, Final Report March, 2000. 2004 data from Employer Health Benefits 2004 Annual Survey, Kaiser Family Foundation. ** Employees were offered more generous benefit packages in recent years.

113 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 113 Table 5.7 Firms Offering Health Insurance Coverage by Firm Size, 1996-2005 Source: Employer Health Benefits, 2005 Annual Survey, The Kaiser Family Foundation, and Health Research and Educational Trust. Larger firms are more likely to offer health insurance than smaller firms.

114 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 114 Table 5.8 Number of Health Plans Offered by Firm Size, 2005 Large firms are more likely to offer employees a choice of plans. Source: Employer Health Benefits, 2005 Annual Survey, The Kaiser Family Foundation, and Health Research and Educational Trust.

115 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 115 Table 5.9 Private Health Insurance Enrollment by Plan Type, 1988-2005 Source: Employer Health Benefits, 2001-2005 Annual Survey, The Kaiser Family Foundation and Health Research and Educational Trust. Trends and Indicators in the Changing Health Care Marketplace, 2002 – Chartbook. Since 1988, Conventional Fee-for-Service plans have almost disappeared, while PPOs have grown significantly.

116 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 116 Table 5.10 Employees With a Choice of Health Plans, 1988-2005 ^ Information was not obtained for POS plans in 1988. Source: KFF/HRET Survey of Employer-Sponsored Health Benefits, 2000-2005; KPMG Survey of Employer-Sponsored Health Benefits: 1988, 1993, 1996. In recent years, fewer employees have a choice of conventional FFS plans. A growing share have a choice of PPOs and POS plans. ^

117 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 117 Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 2005. Not all eligible employees enroll in an employer’s health plan. Table 5.11 Covered Employees in Firms That Offer Health Benefits, 2005 Percentage of Workers Eligible for Employer Health Benefits Small Firms (3-199 Workers) Large Firms (200+ Workers Percentage of Workers Covered by Their Employers’ Health Benefits

118 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 118 Section 6 The Uninsured

119 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 119 Table 6.1 Out-of-Pocket Spending by the Under 65 Population by Insurance Status by Income, 2001 and 2003 The percent of health spending from out-of-pocket sources by the uninsured is significantly higher than for those with insurance. Note: Insured includes all types of insurance coverage. Source: Actuarial Research Corporation tabulations of Medical Expenditure Panel Survey. UninsuredInsured

120 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 120 Table 6.2 Out-of-Pocket Spending by the Under 65 Population by Insurance Status by Type of Service, 2001 and 2003 Note: Insured includes all types of insurance coverage. Uninsured individuals may have some of their care financed in part by charity or providers as uncompensated care. Source: Actuarial Research Corporation tabulations of Medical Expenditure Panel Survey. UninsuredInsured Total2001 43% of health spending out-of-pocket 2003 52% Total2001 19% of health spending out-of-pocket 2003 18% In 2003, the insured paid about 18% of their health expenses out-of- pocket, compared to about 52% for the uninsured.

121 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 121 Table 6.3 The Percent Uninsured Within Age Categories, 1987-2005 Note: Under 65 population. Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments. Adults age 18-54 have twice the percentage uninsured as children in 2005.

122 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 122 Table 6.4 Percent Uninsured Within Income Category, 1987-2005 Lower-income groups are more likely to be uninsured than higher-income groups. Note: Under 65 population. Colored lines represent income as a percentage of the poverty line. Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments.

123 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 123 Table 6.5 Percent Uninsured by Ethnicity, 1987-2005 About half of the uninsured are white, and the other half are racial or ethnic minorities. Note: Under 65 population. Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments. Non-Hispanic Black Non-Hispanic American Indian Total Non-Hispanic Asian Other Hispanic Non-Hispanic Black Non-Hispanic American Indian Total Non-Hispanic Asian Other Hispanic

124 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 124 Table 6.6 The Uninsured by Age, 1987-2005 A growing majority of the uninsured are adults 18-54. Note: Under 65 population. See also table 4.34 Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments.

125 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 125 Table 6.7 The Uninsured by Income, 1987-2005 Note: Under 65 population. Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments. The share of the uninsured with incomes above 200% of poverty is growing.

126 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 126 Table 6.8 The Uninsured by Ethnicity, 1987-2005 About half of the uninsured are white, nearly one-third are Hispanic. Note: Under 65 population. Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments.

127 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 127 Table 6.9 The Uninsured by State, 2005 The South and West have higher rates of uninsured than the Mid-west and East. Medium (14% - 17.9%) High (18%+) Low (7% - 13.9%) WA OR ID MTND WY NV CA UT AZ NM KS NE MN MO WI TX IA IL IN AR LA AL SC TN NC FL OH MI WV PA NY AK MD ME VT NH MA RI CT DE DC HI CO GA MS OK NJ SD National average is 16% VA KY *Other includes private non-group and other public insurance (mostly Medicare and military-related). Medicaid includes CHIP. Source: Census Bureau, March Current Population Survey.

128 Centers for Medicare & Medicaid Services Office of the Assistant Secretary for Planning and Evaluation 128 Table 6.10 Impact on Non-Elderly Adults of Being Uninsured, 2006 The uninsured face financial and other barriers to health care. Note: Among adults under age 65. Source: Kaiser Foundation, The Uninsured: A Primer, Jan. 2006.


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