National Health Expenditures, 1981

The United States spent an estimated $287 billion for health care in 1981 (Figure 1 Health care expenditures continued to grow at a rapid rate in 1981, at a time when the economy as a whole exhibited sluggish growth. The 9.8 percent share of the GNP was a dramatic increase from the 8.9 percent share seen just two years earlier. Health care expenditures amounted to $1,225 per person in 1981 (Table 1). Of that amount, $524, or 42.7 percent, came from public funds. Hospital care accounted for 41.2 percent of total health care spending in 1981 (Table 2). These expenditures increased 17.5 percent from 1980, to a level of $118 billion. Spending for the services of physicians increased 16.9 percent to $55 billion—19.1 percent of all health care spending. Public sources provided 42.7 percent of the money spent on health in 1981, including Federal payments of $84 billion and $39 billion in State and local government funds (Table 3). All third parties combined—private health insurers, governments, private charities, and Industry—financed 67.9 percent of the $255 billion in personal health care in 1981 (Table 4), covering 89.2 percent of hospital care services, 62.1 percent of physicians' services, and 41.3 percent of the remainder (Table 5). Direct patient payments for health care reached $82 billion in 1981, accounting for 32.1 percent of all personal health care expenses (Table 6). Consumers and their employers paid another $73 billion in premiums to private health insurers, $67 billion of which was returned in the form of benefits. Outlays for health care benefits by the Medicare and Medicaid programs totaled $73 billion, including $42 billion for hospital care. The two programs combined paid for 28.6 percent of all personal health care in the nation (Table 7).