Trends in Health Care Expenditures for the Elderly Age 65 and Over: 2006 Versus 1996

This Statistical Brief compares summary statistics on health care expenditures and expenditure distributions by type of service and source of payment for the elderly (age 65 and over) in 2006 relative to the elderly in 1996. The estimates are derived from data collected in the Medical Expenditure Panel Survey Household (MEPS-HC) and Medical Provider Components (MEPS-MPC) on the U.S. civilian non-institutionalized population. Health care expenses in MEPS represent payments to physicians, hospitals, and other health care providers for services reported by respondents to the MEPS-HC. Estimates for 1996 were adjusted to 2006 dollars based on the GDP Price Index to remove the impact of medical inflation between 1996 and 2006 on comparisons

The $333.3 billion in total health care expenses for the elderly in 2006 was over $100 billion higher than inflation-adjusted expenses for 1996 (figure 1). In each year, over 95 percent of the elderly had some expenses, but the average annual expense per person with an expense was about 30 percent higher in 2006 ($9,080 versus $6,989 in 1996 after adjusting for inflation). In 2006, the median annual health care expenditure for persons age 65 and over was $4,032 (figure 2), with about one-quarter of the elderly having no expenses or expenses under $1,752 (25th percentile) and one-quarter having expenses over $9,289 (75th percentile). These quartile levels were at least 50 percent higher than in 1996 (after adjusting for medical price inflation from 1996 to 2006).