JPMorgan Chase Institute Releases First Report On Out-Of-Pocket Healthcare Spending For 2.3 Million American Families Based on New Data Source

Report shows American families consistently delay healthcare payments until they have ability to pay, illustrates clear link between financial health and healthcare spending

WASHINGTON--()--Today the JPMorgan Chase Institute released a first-ever look at out-of-pocket healthcare spending by US consumers, using the real financial transactions of 2.3 million Americans. The data evaluates spending on a month-to-month basis, at the state, metro, and county level, showing how spending habits changed over a four-year period from 2013-2016.

The report, Paying Out-of-Pocket: The Healthcare Spending of 2 Million US Families, shows that families consistently delay healthcare payments until they have more liquid assets at their disposal. Healthcare payments noticeably spike in the months of March and April, when the majority of American households receive their tax refunds.

"The reality is that many American families don’t have the cash buffer to withstand the volatility created by out-of-pocket healthcare payments, and we need to better understand the correlation between financial health and physical health," said Diana Farrell, President and CEO, JPMorgan Chase Institute. "For the first time ever, we are able to look at the real impact of healthcare payments on the pocketbooks of American families and how these expenditures fit in to their larger financial condition. These data can serve as a resource for policymakers at the federal, state, and local level to better understand how healthcare policy decisions affect their constituents in very tangible ways."

Some of the report’s key takeaways include:

  • A clear correlation exists between timing of healthcare payments and an account-holder’s ability to pay, with the largest payments taking place in the years and months with increased liquid assets. This finding emphasizes the clear link between a family’s financial health and their access to healthcare services.
    • The report found a clear spike in payments during the months of March and April, when nearly 80 percent of tax filers receive tax refunds.
  • There is significant variation of out-of-pocket expenses among and within states, emphasizing the important role of states in shaping healthcare policy. Colorado families spent the most out of pocket, while families in Louisiana and Oklahoma spent the most as a percent of income. California was among the lowest in terms of both raw dollar amounts and payments as a share of income.
    • As part of this report, the JPMorgan Chase Institute has created online data visualization assets to illustrate these disparities and is providing downloadable payment data with information broken down to metro and county levels.
  • Out-of-pocket payments grew each year since 2013, but have remained a stable share of income, also known as “burden.” However, women, low-income families and pre-seniors are bearing the highest cost burden. The finding merits further study to establish whether these higher payments represent broader healthcare utilization or a clear expense burden for populations that can afford it the least.
  • Families that are in the top 10 percent of healthcare spending in a given year tend to remain the highest spenders on a year-over-year basis, emphasizing the substantial cost of chronic conditions and long-term healthcare needs.
  • Doctor, dental and hospital payments accounted for more than half of out-of-pocket payments. While doctor payments accounted for the greatest volume of expenditures, dental and hospital payments were much more significant in terms of expense.

The JPMorgan Chase Institute report is based on a new data asset, the JPMorgan Chase Institute Healthcare Out-of-Pocket Spending Panel (JPMCI HOSP). The asset was constructed using a sample of 2.3 million de-identified regular Chase customers age 18 to 64 between January 2013 and December 2016. The Institute defined out-of-pocket healthcare spending as any observed payments to healthcare providers and drugstores, including co-payments, co-insurance, deductibles, and other point-of-service medical, dental, or drug spending.

Key Findings: Paying Out-of-Pocket: The Healthcare Spending of 2 Million US Families

  • Out-of-pocket healthcare spending grew between 2013 and 2016 but remained a relatively constant share of take-home income.
    • The average out-of-pocket healthcare spending in 2016 was $714 and the median was $276. Out-of-pocket healthcare spending grew at an average annual rate of 4.3 percent and a total of 14 percent from $629 in 2013 to $714 in 2016.
    • Healthcare spending measured in terms of financial burden was relatively stable between 2013 and 2016, hovering around 1.6 percent as a share of take-home income and 1.2 percent of total spending.
  • The financial burden of out-of-pocket healthcare spending was highest for older, low-income, and female account holders
    • Female account holders spent 1.8 percent of take-home income in 2016 on healthcare compared to 1.5 among male account holders.
    • The bottom income quintile of account holders spent 2.8 percent of take-home income on out-of-pocket healthcare costs in 2016, compared to only 1.0 percent of take-home income for the top income quintile of households.
    • Eighteen to 25-year-olds spent just 1.2 percent of take-home income on out-of-pocket healthcare expenses, while 55 to 64-year-olds spent 1.9 percent.
  • Doctor, dental, and hospital payments accounted for more than half of observed spending, with dental and hospital payments less frequent but larger in magnitude.
    • Payments to doctors’ offices (22 percent), dental offices (21 percent), and hospitals (12 percent) accounted for 55 percent of healthcare spending in 2016.
    • Doctors' office and dental payments varied notably in frequency and magnitude, as more than half of families (52 percent) made payments (with an average of $293) to doctors' offices in a given year, compared to 32 percent of families making an average out-of-pocket dental payment of $465.
  • Healthcare spending appears to be highly concentrated, with healthcare outflows from the top 10 percent of spenders amounting to 9 percent of total take-home income.
    • In absolute dollar terms, the top 10 percent of spenders accounted for 49 percent of total out-of-pocket spending in 2016, with an average spend total of $3,482.
    • High-burden accounts tended to remain high-burden accounts. Almost half of accounts in the top 10 percent of healthcare spending burden in 2015 were there the following year.
  • Healthcare payments were highest in the months and years when inflows were highest.
    • Months and years marked by higher healthcare spending tended to coincide with months and years marked by higher take-home income and liquid assets, indicating that ability to pay was associated with demand for healthcare services.
    • In each of the four years studied, healthcare spending was highest in March and April, which coincides with when roughly 80 percent of tax filers receive a tax refund.
  • There was dramatic variation in out-of-pocket healthcare spending between and within the 23 states studied in the report.
    • Average out-of-pocket healthcare spending in 2016 was highest in Colorado ($916) and lowest in California ($596).
    • Large geographic variation also occurred within states. For example, among five target states studied – California, Florida, New York, Ohio, and Texas – there was a more than twofold difference between the highest-spend and lowest-spend counties.

Click here to read the full report.

About the JPMorgan Chase Institute

The JPMorgan Chase Institute is a global think tank dedicated to delivering data-rich analyses and expert insights for the public good. Its aim is to help decision makers–policymakers, businesses, and nonprofit leaders–appreciate the scale, granularity, diversity, and interconnectedness of the global economic system and use better facts, timely data, and thoughtful analysis to make smarter decisions to advance global prosperity. Drawing on JPMorgan Chase & Co.’s unique proprietary data, expertise, and market access, the Institute develops analyses and insights on the inner workings of the global economy, frames critical problems, and convenes stakeholders and leading thinkers. For more information visit:


For JPMorgan Chase Institute
Caitlin Legacki, 202-585-3702


For JPMorgan Chase Institute
Caitlin Legacki, 202-585-3702