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It’s one of the hardest figures to square in the American health care system: A small slice of patients, just 5 percent, account for over 50 percent of all medical expenditures for the entire United States. In other words, if the country’s population was just 20 people, it would spend the same amount on its sickest resident as it would for the next 19 combined.
Last year, America’s total medical costs hit a new record of $3.4 trillion, according to the federal government. That’s about 18 percent of the country’s total GDP, meaning that one out of every six dollars we spent in 2016 went to health care. The national doctor bill dwarfs anything else we spend money on, including food, clothing, housing, or even our mighty military.
If that $3.4 trillion were spread equally throughout the population, the bill would come to some $10,350 for every man, woman and child in the country. But fortunately –for most of us, anyway—the cost of health care is not equally distributed. Rather, a small number of Americans run up most of the expense. The biggest medical costs are concentrated on a fairly small segment of the population—people with one or more chronic illnesses, plus victims of accidents or violent crime. The cost is so concentrated, in fact, that an estimated five percent of the population accounts for 50 percent of total medical costs.
For the purposes of this project, we’re calling these people The Platinum Patients—they’ve also been described as “super-utilizers” or “frequent fliers.”
Each year, 1 in every 20 Americans racks up just as much in medical bills as another 19 combined. This critical five percent of the U.S. population is key to solving the nation's health care spending crisis.
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This concentration of total cost on a small segment of the total population is reflected in another common aspect of medical spending: the concentration of treatment, and cost, in the end of a life span. For most people, the vast majority of all the health care they’ll ever get comes near the hour of death. Hundreds of billions of dollars each year are spent treating Americans who are in the last weeks, or days, of life.