Many major expenses only shrink once you retire, but health care is hardly one of them.
U.S. households led by someone who is 65 or older spend an average of $6,700 a year on health care, according to the Bureau of Labor Statistics’ latest data on consumer spending, which covers July 2017 to June 2018.
That translates to 13.4% of all spending by senior households and makes health care the third-biggest spending category among senior households. Only housing and transportation account for bigger shares of their spending.
By comparison, all U.S. households spend an average of $4,924 a year on health care, which translates to 8.1% of spending across all households.
Following is a detailed look at how senior households’ medical spending breaks down.
Health insurance
Average spending for a U.S. household led by someone age 65 or older: $4,744 per year
Average spending across all U.S. households: $3,395 per year
Insurance is easily the largest health care expenditure for households of any age, but it’s highest for senior households. On average, they spend $4,744 a year — about $395 a month — on insurance. That’s 9.5% of their total spending.
As defined by the BLS, the expense of health insurance includes various types of insurance — such as traditional fee-for-service health plans, HMOs and Medicare supplements, for example.
Medical services
Average spending for a U.S. household led by someone age 65 or older: $949 per year
Average spending across all U.S. households: $873 per year
As defined by the Bureau of Labor Statistics, this type of health care expense includes a wide variety of care, including:
- Hospital room and services
- Services from physicians and other professionals
- Eye and dental care
- Lab tests and X-rays
- Medical care in a retirement community
- Care in a convalescent or nursing home
Interestingly, the category of medical services is the only type of health care expense that is not highest among senior households. U.S. households led by someone age 55-64 spend more on medical services — $1,140 per year, on average.
Drugs
Average spending for a U.S. household led by someone age 65 or older: $774 per year
Average spending across all U.S. households: $489 per year
Drug spending includes spending on prescription and nonprescription medications as well as vitamins.
While senior households are spending about $65 a month on drugs alone, there are numerous ways anyone can cut their drug costs — including some ways you may not realize exist.
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