Health spending distribution in the United States by payer 2018-2022

In 2022, health spending in the United States reached approximately 4.6 trillion U.S. dollars, and private insurance accounted for around 29 percent of that figure. However, public health insurance, which includes the Medicare and Medicaid programs, combined for a share of around 39 percent. 

The rising costs of health care coverage

U.S. national health expenditure continues to increase and is projected to exceed four trillion U.S. dollars in 2021. Hospital care and physician services have been the leading spending categories for several years and combined for more than half of all health spending in 2021. In the same year, federal and state governments made up 61 percent of national health expenditures, with the federal government’s share accounting for 27 percent.

The differences between Medicare and Medicaid

Medicare and Medicaid were both signed into U.S. law by President Johnson in 1965. Medicare is a health insurance program solely funded by the federal government. The plan was primarily created for all Americans aged 65 and older, regardless of their income. Medicaid is administered at a state level in accordance with some core federal requirements, but both fund the program. The plan provides health care to millions of Americans, and some states have expanded the Medicaid program to cover nearly all low-income adults under the age of 65.