Burden of healthcare cost move to middle class.

Posted: Aug 26, 2016

less money for other things. Growth in overall health-care spending is slowing, but middle-class families’ share of the tab is getting larger, squeezing households already feeling stretched financially. Growth in overall health-care spending is slowing, but middle-class families’ share of the tab is getting larger, squeezing households already feeling stretched financially. Overall, health-care spending across the economy reached 18.2% of gross domestic product as of June, up from 13.3% in 2000, according to Altarum Institute, a health research group. However, the mix of who pays has evolved. The government has taken on a larger share in recent years as more people age into Medicare, and the Affordable Care Act expanded Medicaid and provided subsidies for low-income people buying insurance on state exchanges. Middle-class households are finding more of their health-care costs are coming out of their own pockets. David Cutler, a Harvard health-care economist, said this may be “a story of three Americas.” One group, the rich, can afford health care easily. The poor can access public assistance. But for lower middle- to middle-income Americans, “the income struggles and the health-care struggles together are a really potent issue,” he said. A June Brookings Institution study found middle-income households now devote the largest share of their spending to health care, 8.9%, a rise of more than three percentage points from 1984 to 2014... Workers aren’t the only ones feeling the pain of rising health-care costs. Employers still typically pay roughly 80% of individual health-insurance premiums, a share that has held fairly steady in the past five years, thanks in part to changing plan designs that shift more costs to workers, said Beth Umland, director of research on health and benefits at Mercer US Inc. ;