2014 Milliman Medical Index-Medical Expenditures More than Double in US

Christopher S. Girod, Lorraine W. Mayne, Scott A. Weltz, Susan K. Hart | Milliman Insight | May 20, 2014

$23,215. That’s how much is spent in 2014 on healthcare for a typical American family of four covered by an average employer-sponsored health plan according to the 2014 Milliman Medical Index (MMI).1 And yet while the amount has more than doubled over the past 10 years, growing from $11,192 to $23,215, the 5.4% growth rate from 2013 to 2014 is the lowest annual change since the MMI was first calculated in 2002.

Employers pay the largest portion of healthcare costs, contributing $13,520 per year, or 58% of the total. However, increasing proportions of costs have been shifted to employees. Since 2007, when the economic recession began, the average cost to employers has increased 52%—an average of 6% per year—while the expenses borne by the family, through payroll deductions and out-of-pocket costs, have grown at an even faster rate, 73% (average of 8% per year).

Throughout this report we review the various components of the cost increases, how they are shared between employers and employees, and what key drivers are most likely to affect healthcare costs in 2014 and beyond...