The Concentration of Health Care Spending

Updated charts using the latest data are available here.

Key Points From This Brief:

  • Spending for health care services is highly concentrated among a small proportion of people with very high use. Conversely, a significant portion of the population has very low health care spending.

  • People who are older or who have one or more chronic medical conditions or functional limitations are significantly more likely to be among the highest spending patients.

  • High spending persists over multiple years for many patients, while others return to more normal spending levels after an expensive episode. There is also evidence that high spending occurs near the end of life for many patients, particularly within the Medicare population.

  • Targeting the highest spenders represents the greatest opportunity to have a significant impact on overall spending, but implementation of strategies directed at high spenders is challenging for a number of reasons.

  • The concentration of health spending also has important implications for health policies related to acceptance of and compensation for differential risks.

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