Health Populi

Tuesday, September 11, 2007

Health Care is the #1 Line item in our National Economy…and Taking More out of your Pocket

Health care is as American as apple pie, at least when it comes to spending. The usual metric for the macroeconomy is the Gross Domestic Product (GDP). This is defined as the market value of all goods and services produced in a country. Technically,

GDP = Personal Consumption + Investment + Government Spending + (Exports – Imports)

Personal consumption is the largest single component of the economy. Health care comprises over 17% of personal consumption expenditures, and housing, 15%. The third largest line item in personal consumption is food, which eats up 14% of personal consumption expenses.

Health Care is the Largest Single Line Item in the American Economy

Source: Bureau of Economic Analysis, U.S. Department of Commerce, Gross Domestic Product: Fourth Quarter 2006

Thus, health care took 17 cents of each dollar spent in 2006. By 2015, this proportion is forecasted to be 20% -- that is, 1 of every 5 dollars in America will go to health care.


Health Populi's Hot Points: You’re upset about the cost of gas. Yet, gas, fuel and energy consume 75% less of your spending than health care. Face that fact, and get smart!

Sources: Health Care Spending: Public Payers Face Burden of Entitlement Program Growth, While All Payers Face Rising Prices and Increasing Use of Services, February 15, 2007, General Accounting Office, GAO-07-497T (http://www.gao.gov/)

posted by Jane Sarasohn-Kahn at 12:19 PM

3 Comments:

  • Thank you Jane. I have found yourblog thru a link at health care policy and marketplace and I found all of your posts very worthwhile reading and look forward to more. I particularly like your focus on putting health care expenditures in the overall economic context. You also seem to be relatively free of ideological bias. I myself am an agnostic on policy - I'll support whichever policy that can be shown by objective data to be the best solution.

    By Anonymous MT, At September 14, 2007 3:32 PM  

  • I appreciate your article here. Health care spending and reform are thought to be major issues in the next presidential election. Spelling it out this way puts it into perspective. I will be watching and linking to your blog as I am commenting on the stated policies of the candidates. Keep up the good work.

    By Blogger Bruce, At September 16, 2007 9:25 AM  

  • Very interesting article and congratulations for the blog. This has been publish as a new into Health 2 Info portal.

    http://health2.info/story.php?id=403

    By Anonymous Miguel Cabrer, At September 18, 2007 4:40 PM  

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