Out-of-pocket health care costs total $363 billion

Consumers are spending $363 billion a year on ancillary health care, according to a new study by Deloitte. Ancillary care falls outside of conventionally counted health care costs such as doctors, prescriptions, hospitals and health insurance coverage.

The report, "The Hidden Costs of U.S. Health Care for Consumers: A Comprehensive Analysis," was conducted by Deloitte's Center for Health Solutions and Center for Financial Services to gauge the total costs consumers really spend out of their own pockets on health care products and services beyond what is typically paid by insurers and other government sources, such as Medicare and Medicaid.

"The ability of the U.S. economy to recover will be affected in part by how much consumers have in their pockets to spend," said Andrew Freeman, executive director of the Deloitte Center for Financial Services. "This reveals a tremendous burden on the average consumer."

More than half of ancillary spending (55%) was for supervisory care, or care given by unpaid relatives and friends. Other expenditures included complementary and alternative medicine practitioners (8%) and products (1%), functional foods and other nutritional products, vitamin and mineral supplements (15%), health publications (1%), ambulance services (3%), other ambulatory care, such as blood banks, some health promotion programs (6%), mental health services (8%), homes for the elderly (4%) and weight loss facilities (1%).

The report “sheds new light on the hidden costs of health care, and how these costs can add up significantly to billions of dollars and can even eclipse housing as a household expense," says Paul Keckley, Ph.D., executive director of Deloitte’s Center for Health Solutions. "Our study explores the financial context for the decisions consumers — not simply patients —– make about how they spend their money on health care, which will only increase in importance as health care reform continues to take hold."

Other findings include:

• The total 2009 U.S. per capita expenditures on health care were $9,217; professional services (29%) and hospital care (27%) were the biggest categories.
• The estimated value of supervisory care ($199 billion) is significantly higher than total spending on nursing homes ($144 billion) and total spending on home health care ($72 billion), and was only somewhat less than prescription drug expenditures ($246 billion).
• Around 70% of spending on nutrition industry items was for functional foods, a category which includes such items as enriched cereals, breads, sports drinks, bars, fortified snack foods, baby foods and prepared meals.
• Seniors account for 36% ($1.01 trillion) of total health care expenditures, but make up only 13% of the population.
• A majority (80%) of adults surveyed said they would use generic medicines, seek free advice from a pharmacist or other medical professional (70%), and use technology (61%) if it would save money.
• Approximately 43% would visit a retail clinic, and 20% would visit another country, for more affordable medical care.
• 26% would skip a medical test or screening, skip a visit to the dentist or doctor altogether (26%), or skip refilling a prescription (22%) to save money on health care.