Health Affairs report shows Alaskans spent more out-of-pocket dollars on health care than residents in any other state in 2019

Alaskans spent more out-of-pocket dollars on health care costs than residents in any other state in 2019, according to a recent Health Affairs study.

 

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The study examined spending variation across the US to determine that state-specific per-person spending ranged from $7,250 to $14,500 in 2019. US health care spending was highest in Alaska, where per-person spending was $14,500. Out-of-pocket spending represented 42% of the health care dollars spent in the state, which means more than $4 of every $10 spent on health care in the state came from out-of-pocket expenditures.

“These disparate trajectories are the consequence of state-specific factors that affect the demand for care, including demographics and the underlying health of the population, as well as differences in how health services are provided, financed, and regulated in each state,” the report states. 

Other factors included health care provider supply, the state’s population share that was enrolled in Medicare or Medicaid, and personal income.

For comparison purposes, the region that saw the second-highest out-of-pocket spending was the District of Columbia, where residents spent $14,080. But that money was likely to come from private payers (49%), Medicaid (26%), or Medicare (13%), compared to 12% of funds that came from patients’ pockets. Spending from private payers represented about 31% of health care costs in Alaska, while Medicaid spending was at 18%, and Medicare was at 9%.

Alaska’s annualized rate of change per person increased 3.6% from 2013 to 2019, according to the report.

The research was conducted using 368,640 models predicting total health spending for each state. The primary model for total spending estimated year-over-year changes and used primary data from Medicaid SMS-64 administrative reports, Medicare spending estimates, the American Hospital Association, the Bureau of Economic Analysis, and the Medical Expenditure Panel Survey. 

“Out-of-sample validation showed that for five years of prediction, mean absolute error of health spending per person (which reflects the average amount that our modeled estimates deviated from observed estimates when applied to historic data) was $73,” the report states.