Public Funds Account for Over 70 Percent of Health Care Spending In California

This policy brief examines public versus private health care expenditures in California.  The authors find that personal health care expenditures are estimated to total more than $367 billion in 2016 and that approximately 71 percent of these expenditures will be paid for with public funds (i.e., taxpayer dollars). This estimated contribution of public funds to health care expenditures is much higher than estimates that include only major health insurance programs such as Medicare and Medicaid. Several additional public funding sources also contribute to health care expenditures in the state, including government spending for public employee health benefits, tax subsidies for employer-sponsored insurance and the Affordable Care Act (ACA) insurance exchange, and county health care expenditures. As health care reform continues to take effect, it will be important to monitor the public versus private contributions to state health care expenditures to ensure that funds are being distributed both efficiently and equitably.

• Andrea Sorensen
• Narissa Nonzee
• Gerald F. Kominski, Ph.D.