Medicare households are spending far more on healthcare than other households, according to a new KFF analysis.
Researchers analyzed data from the 2022 Consumer Expenditure Survey, tracking spending trends between 2013 and 2022. At the end of that window, health-related expenses in Medicare households averaged $7,000, or 13.6% of total household spending.
By comparison, non-Medicare households spent on average 6.5% of their total on health-related expenditures, or $4,900.
Healthcare expenses included insurance premiums, medical services, prescription drugs and medical supplies like crutches, hearing aids and eyeglasses.
"With health care use increasing with age and with most Medicare beneficiaries living on relatively low incomes and modest financial assets to draw upon in retirement, it’s not unexpected that health care is a bigger cost burden for Medicare households," the researchers wrote.
The study also found that close to 3 in 10 Medicare households spent at least 20% of their total spending on health-related items, compared to just 7% of non-Medicare households. Most (74%) of Medicare households spent at least 10% of their total household spending on healthcare, according to the analysis.
Given inflation and rising costs overall, spending on healthcare for Medicare households grew by 53% from 2013 to 2022, rising from $4,600 to $7,000. However, the proportion of total household spending that was going to healthcare was roughly the same, 13.5% in 2013 compared to 13.6% in 2022.
For non-Medicare households, spending on healthcare grew by 71% between 2013 and 2022, increasing from $2,800 to $4,900. The portion size was also slightly higher by 2022, rising from healthcare accounting for 5.4% of total household spending in 2013 to 6.5% by 2022.
The researchers note that the analysis is likely under-counting spending, particularly in Medicare, as the Consumer Expenditure Survey does not account for people who live in long-term care facilities. That population is more likely to enrolled in Medicare, and they often face significant cost exposure in long-term care.
Analyses like this one are valuable to policymakers, the researchers said, as multiple solutions have been proposed to tackle rising healthcare costs broadly as well as those in Medicare specifically. There are also notable implications for certain disease states that are often costly and are fairly common in the Medicare population, such as diabetes.