The Highs and Lows of California’s Health Care Spending

The Sacramento Bee –

March 26, 2013:

Health care has become, by most measures, the largest single piece of the California economy, well over 10 percent of its $2 trillion output of goods and services — and destined to grow as the state extends medical insurance coverage to millions of Californians under the federal Affordable Care Act.

Nevertheless, a new nationwide study finds that as large as it may be, the health care spending in California has been relatively small, compared to other states.

The statistical compilation by the Dallas-based National Center for Policy Analysis found that as of 2009, the latest year for which complete data were available, California was sixth lowest among the states in public and private health care spending as a proportion of its economy. The state’s relative spending, 12.5 percent of its economy, was just 84 percent of the national average.

When the two largest public medical care programs, Medicaid (Medi-Cal) for the poor and Medicare for the aged were excluded, California was third lowest in health spending.

Conversely, when it came to Medicaid, the state was second highest in having 23.1 percent of its population enrolled, although spending under that program per enrollee was dead last, just 67 percent of the national average.

In addition to a category-by-category and a state-by-state breakdown of health spending prior to implementation of the new federal program, the study also contains data on Medicare spending and usage in the state’s most populous counties, showing wide variations in both. Los Angeles County, for instance, is in the 95th percentile of sending per Medicare enrollee, while Sacramento County is in the 21st percentile, with spending just two-thirds of that in Los Angeles.

Source: John & Rusty Report via Choice Admin