2009 Milliman Medical Index
Unprecedented economic uncertainty has accelerated cost increases in some ways and at the same time reduced certain categories of utilization.
Last year, when healthcare costs for the typical American family of four exceeded $20,000 for the first time, the Milliman Medical Index (MMI) compared the cost of a family’s healthcare to the cost of an average midsize sedan. This year, with costs exceeding $22,000 ($22,030), we note that other major purchases are also comparable to the annual cost of healthcare. For example, the cost of attending an in-state public college is $22,261 for the current academic year.1
The total share of this cost borne directly by the family—$9,144 in payroll deductions and out-of-pocket costs—now exceeds the cost of groceries for the MMI’s typical family of four.2 The out-of-pocket cost alone—$3,600 for co-pays, coinsurance, and other cost sharing—is more than the average U.S. household spends on gas in a year.3
Whether our family fully realizes the degree to which total healthcare costs eclipse so many other household costs is another question. The employer pays a significant share of our typical family’s healthcare cost; some of these costs are not visible in the family budget. But for four of the last five years, our family has seen a larger percentage increase in costs than the employer. Our typical family is well aware of the increasing cost of care, even if it is only responsible for paying 41 cents of every healthcare dollar.
As measured by the 2013 MMI, the total annual cost of healthcare for a typical family of four covered by an employer-sponsored preferred provider plan (PPO) is $22,030.
1 COLLEGEdata. What’s the Price Tag for a College Education? Retrieved May 16, 2013, from https://www.collegedata.com/cs/content/content_payarticle_tmpl.jhtml?articleId=10064.
2 United States Department of Agriculture, Center for Nutrition Policy and Promotion. Official USDA Food Plans: Cost of Food at Home at Four Levels, U.S. Average, March 2013. Accessed May 16, 2013, from http://www.cnpp.usda.gov/Publications/FoodPlans/2013/CostofFoodMar2013.pdf.
3 Autoblog.com. US families spent an average of nearly $3,000 on fuel last year. Retrieved May 16, 2013, from http://www.autoblog.com/2013/02/05/us-families-spent-an-average-of-nearly-3-000-on-fuel-last-year/.