Much of the angst over rising health costs has focused on the hardship they inflict on patients, as well as state and federal budgets.

But The Wall Street Journal points out another victim of ballooning medical costs: The rest of the U.S. economy.

As the share of Americans’ income devoted to health care increases, the amount left to spend on other things naturally declines. As a result, everybody in the business of selling something other than health care is feeling the pinch.

Since 2007, Americans’ spending on health care has risen 25 percent. In the same time period, their spending on everything else has declined 6.3 percent.

Retail has been hit particularly hard. For example, people spend 13.4 percent less on food away from home and 18 percent less on clothes.

While the cost of health care has been rapidly rising over the past two decades, until recently, much of that cost was absorbed by employers. However, employers have begun to shift away from generous health plans in favor of high-deductible plans or consumer-driven plans that require greater out-of-pocket spending from employees.

A study by the Kaiser Family Foundation found that spending on deductibles rose 256 percent between 2004 and 2014. Overall cost-sharing by beneficiaries increased 77 percent during that time.

The dramatic rise in the cost of prescription drugs has also hit consumers more directly than some past health care cost increases, say economists.

Wal-Mart Inc. was already raising the alarm three years ago, complaining that the individual mandate to buy insurance would hurt spending on other goods. Of course, while the money that individuals spend on a mandatory insurance plan certainly diverts income from other areas of spending, the effect on the overall health care system is hopefully to lower costs for others.

Instant Insights /

Americans spending less on other things because of health costs

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