The out-of-pocket portion of health care spending for Americans with employer-sponsored coverage increased faster than both wages and general inflation over the past decade, according to the Peterson KFF Health System Tracker. In recent years, however, there has been a shift in which cost sharing now is growing at a rate more similar to inflation.
Total out-of-pocket spending averaged $869 in 2023. The majority of this spending was for outpatient services, followed by prescription drugs and inpatient services:
- On average, there has been a rise in cost-sharing amounts for outpatient services, especially through deductibles. The average amount paid through deductibles for outpatient care more than doubled from $198 in 2012 to $404 in 2023. Making up 60% of outpatient out-of-pocket spending.
- For prescription drugs, copayments remain the dominant form of cost sharing, comprising 57% of out-of-pocket costs in 2023, or about $101 on average. However, total out-of-pocket expenditure on prescription drugs has increased by only 19% since 2012, rising from $149 to $177 on average.
- Average out-of-pocket spending on inpatient care has been relatively stable over the past decade, and cost sharing for inpatient care comes mainly through coinsurance. Although average out-of-pocket costs for inpatient care are relatively low at $61 per person, this is largely because few people need such care in any given year. For someone who is hospitalized, the cost can be substantial.
“How enrollees pay cost sharing influences how people anticipate and manage health costs throughout the year,” the report said. “On average, spending on deductibles tends to spike early in the year and subsides after people with several healthcare visits meet their deductible. On the other hand, enrollees may incur copayments and coinsurance more consistently throughout the year, depending on the frequency and type of services they use.”
Some enrollees have additional spending such as on out-of-pocket payments for non-covered services or balance-billing payments to health care providers for out-of-network services. Overall, the average combined health spending for an individual with an employer plan has trended upward. This amount reflects both the amount paid by the enrollee in cost sharing at the point of service and the cost paid for by the plan.
“Plans continue to cover most of enrollees’ health costs on average, and the share paid for by the health plans have, over time, increased,” the report said. “The out-of-pocket share has subsequently decreased slightly from 15% of total annual health spending in 2012 to 13% in 2023.
“However, even if the share that enrollees pay has decreased on average. They still paid more out of pocket. While there was a temporary decline in out-of-pocket spending during the COVID-19 pandemic alongside a decline in spending for people with insurance generally, these costs have largely rebounded and have risen by about 24% since 2020.”
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