California Reports $408B in Total Health Care Expenditures for 2023

The recent Health Care Affordability Advisory Committee meeting highlighted significant trends in California's health care spending, revealing a growing financial burden on residents. The meeting, held by the Department of Health Care Access and Information, focused on the latest data regarding total health care expenditures (THCE) and total medical expenses (TME) across various markets.

In 2023, California's total health care expenditures reached approximately $408.6 billion, marking an increase of $31 billion or 8.2% from the previous year. This translates to a per capita expenditure of $10,847, up by $811 from 2022. The growth rates varied across different sectors, with Medi-Cal spending rising by 6.5%, Medicare by 6%, and commercial spending by 5.8%. These figures underscore a persistent challenge in health care affordability, particularly as the financial burden on workers with private coverage has outpaced growth in household incomes over the past two decades.

The meeting also addressed the rising costs associated with administrative expenses and profits within the health care system. For instance, administrative costs in the commercial market increased by 25.3% from 2022 to 2023, now accounting for 8% of total commercial spending. Similarly, Medi-Cal managed care saw a 26% rise in administrative costs, which now represent 15% of total spending in that sector.

The committee discussed the implications of these trends for California residents, emphasizing the need for ongoing efforts to improve health care affordability. The data presented indicates that while spending is increasing, the growth in household incomes is not keeping pace, leading to heightened financial strain for many families.

In conclusion, the meeting served as a crucial platform for discussing the current state of health care spending in California and its impact on residents. As the committee prepares for future reports, the focus will remain on addressing these affordability challenges and ensuring that health care remains accessible for all Californians.