The American healthcare system is notoriously expensive. In 2023, total health spending reached $4.9 trillion, or $14,570 per person. As a share of the nation’s Gross Domestic Product (GDP), healthcare accounted for 17.6% of the economy.
To manage these high costs, Americans rely on health insurance. But insurance in the U.S. is complex and often difficult to navigate. There are public programs like Medicare and Medicaid, and private plans, often provided through employers. Insurance designs vary widely, with deductibles, copays, and coinsurance that shift costs to patients. Moreover, not all services are covered. For example, eye care and dental care typically require separate insurance.
This complexity makes it hard for people to estimate how much they’ll pay out of pocket when they need care. In this post, I use data from the Medical Expenditure Panel Survey (MEPS), which covers the entire year of 2022, to estimate average total healthcare costs and how much individuals pay out of pocket on average.
Average Healthcare Cost Estimates from MEPS (Calendar Year: 2022)
| Category | Everybody | Cancer Patients | Breast Cancer Patients | Lung Cancer Patients |
|---|---|---|---|---|
| Sample Size | 22,431 | 2,355 | 419 | 75 |
| Uninsured | 6.71% | 2% | 0.78% | 0% |
| On Medicare | 19.7% | 64.84% | 71.90% | 84.10% |
| On Medicaid | 23.5% | 12.03% | 16.53% | 24.60% |
| Total Healthcare Expenditure | $6,764.68 | $17,515.68 | $16,957.31 | $40,714.56 |
| Total Self-Paid | $920.66 | $1,776.21 | $1,558.68 | $1,230.99 |
| Self-Paid % | 23.6% | 21.1% | 19.76% | 8.23% |
Inpatient Services
| Category | Everybody | Cancer Patients | Breast Cancer Patients | Lung Cancer Patients |
|---|---|---|---|---|
| Total Inpatient Expenditure | $1227.42 | $4,566.29 | $4458.47 | $20,688.33 |
| Self-Paid Inpatient | $36.62 | $64.33 | $34.51 | $152.88 |
| Avg. Inpatient Nights | 0.38 | 1.18 | 1.33 | 5.00 |
| Self-Paid % (Inpatient) | 4.55% | 1.93% | 1.29% | 1.26% |
Office-Based Visits
| Category | Everybody | Cancer Patients | Breast Cancer Patients | Lung Cancer Patients |
|---|---|---|---|---|
| Total Office Visit Expenditure | $1831.36 | $3,789.1 | $3,874.73 | $3,195.80 |
| Self-Paid Office Visits | $354.78 | $534.63 | $317.74 | $138.18 |
| Avg. Office Visits | 6.24 | 12.11 | 12.20 | 12.67 |
| Self-Paid % (Office Visits) | 19.7% | 16.2% | 14.59% | 5.40% |
Emergency Room Visits
| Category | Everybody | Cancer Patients | Breast Cancer Patients | Lung Cancer Patients |
|---|---|---|---|---|
| Total ER Expenditure | $223.02 | $361.1 | $366.82 | $560.89 |
| Self-Paid ER | $17.66 | $17.18 | $21.82 | $13.17 |
| Avg. ER Visits | 0.18 | 0.35 | 0.40 | 0.79 |
| Self-Paid % (ER) | 9.94% | 5.21% | 5.53% | 5.64% |
What this means
Healthcare in the U.S. is undeniably expensive. However, out-of-pocket costs are relatively modest in proportion, hovering around 23.6% of total expenditures. But this doesn’t mean healthcare is affordable. In fact, medical debt remains the leading cause of personal bankruptcy in America. Personally, I hope the U.S. can move toward a system that eliminates cost-sharing and offers free healthcare to all citizens. Of course, we are still far from that reality. Political barriers make any major healthcare reform difficult.
