Medicare Beneficiaries Spent an Average of $5,460 Out-of-Pocket for Health Care in 2016, With Some Groups Spending Substantially More 

The average person with traditional Medicare coverage paid $5,460 out of their own pocket for health care in 2016, according to a new KFF analysis and interactive tool.

This $5,460 includes about $1,000 in out-of-pocket spending for long-term care facility services, averaged across all traditional Medicare beneficiaries.  Such services are used by only 5 percent of beneficiaries in traditional Medicare. For the 95 percent of beneficiaries living in the community, average out-of-pocket spending on health care was $4,519 in 2016. But some groups of beneficiaries spent substantially more than others.

According to the analysis – based on the most current public data — beneficiaries who were likely to spend more out of pocket include women, people in older age groups, those who had been hospitalized, people in poorer self-reported health, and those with multiple chronic conditions.

The analysis comes at a time when some policymakers and presidential candidates are discussing proposals to expand coverage through programs modeled in some respects on Medicare, and improve financial protections and lower out-of-pocket costs for people currently covered by Medicare. Current Medicare-for-all proposals would largely eliminate premiums and out-of-pocket costs, including for those now covered by Medicare.

The analysis includes three interactive graphics that allow users to explore out-of-pocket spending data for different subgroups of Medicare beneficiaries, such as age, gender, and income, to see:

• How much do Medicare beneficiaries spend out-of-pocket for premiums and health-related services?
• Which services contribute the most to Medicare beneficiaries’ out-of-pocket spending?
• How much do beneficiaries spend out-of-pocket on health care costs, as a share of income?

The analysis is based on the most current year of out-of-pocket spending data available from the Medicare Current Beneficiary Survey, a nationally representative survey of Medicare beneficiaries. It does not include spending by beneficiaries in Medicare Advantage plans, due to a lack of publicly available data for beneficiaries enrolled in the private Medicare plans.