by introduction
For the first time since 2017, the federal government has released data on health care spending by state. The data, available for 1991 to 2020, includes personal health care (PHC) spending, which includes goods and services such as hospital care, physician services, and prescription drugs, but excludes the net cost of health insurance, government administration, public health activities, and investment .
In 2020, PHC spending in California totaled $405 billion, accounting for 12% of total US PHC spending. On a per capita basis, healthcare spending in California ($10,299) exceeded the US average ($10,191) for the first time since 1991.
Between 2010 and 2020, annualized healthcare spending in California grew faster than US healthcare spending and the state’s economic growth.
1. Health care spending in California totaled $405 billion in 2020, or $10,299 per person.
In California, private health insurance ($125 billion) accounted for the bulk of healthcare spending, with Medicare and Medi-Cal each paying $87 billion. Private health insurance per enrollment ($5,302) was lower than Medi-Cal ($7,929) and Medicare ($13,564) spending. (Note that Medi-Cal numbers exclude the children’s health insurance program and fully federally funded expenses.)
2. Total per capita healthcare spending in California in 2020 was slightly above US levels.
Per capita health care spending in California was $10,299, slightly above the US average. Medicare spending per participant was 10.5% ($1,300) higher in California than in the US.
3. In 2020, California’s per capita spending slightly exceeded the US average, closing the long-standing gap.
In 2010, California’s per capita health spending of $6,480 was $572 (8.1%) below the US average. However, by 2020, spending increased to $10,299; 1.1% above the US average.
4. Per capita health care spending in California has grown faster than in the US.
Between 2010 and 2020, per capita healthcare spending in California grew at an average annual rate of 4.7%, exceeding the US rate of 3.8%. Similarly, California’s spending per capita grew at a compound annual rate of 5.2% over the five-year period 2015-2020, more than a percentage point faster than the US (4.1%). The difference between per capita growth rates in California (7.0%) and the US (5.4%) in 2020 was even larger.
5. Between 2010 and 2020, total and per participant spending growth in California’s Medi-Cal program outpaced Medicare and private health insurance spending growth.
Between 2010 and 2020, Medi-Cal’s total healthcare spending grew at an annual average rate of 7.6% per year, outpacing all spending (5.3%), private health insurance (4.6%) and Medicare (5.1 %). Medi-Cal’s growth per insured person averaged 5.4% over the same period, ahead of private health insurance (3.5%) and Medicare (2.0%).
6. Per capita health care spending varied widely from state to state, from 26% below the US average in Utah to 37% above the US average in New York.
In 2020, healthcare spending per capita ranged from US$7,522 in Utah to US$14,007 in New York. California’s per capita spending was similar to the national average, ranking 29th out of 50 states (where 1st is lowest). Data for all 50 states is available in the downloadable files below.
7. Private health insurance accounted for the largest portion of healthcare spending in California in 2020.
In both California and the United States, private health insurance accounted for about 30% of personal healthcare spending in 2020. The share of Medicaid spending was slightly higher in California than in the US (21% vs. 17%).
8. Nearly two-thirds of California’s healthcare spending in 2020 went on hospital care and medical and clinical services.
In 2020, hospital care accounted for more than a third of personal healthcare spending in California. Medical and clinical services accounted for another 26%. Nursing home facilities and home nursing each accounted for 5% of the state’s healthcare spending.
9. Spending growth varies by category.
Between 2010 and 2020, other health, home and personal care saw a compound annual growth rate of 11%.
The California Spending Quick Guide and an accompanying data file are available for download below.
These materials are part of the CHCF’s California Health Care Almanac, an online clearinghouse for key data and analysis describing the state’s health care landscape. View our entire collection of current and past issues of Health Care Costs 101.
