Americans spend more on healthcare than people in any other wealthy nation, yet the United States continues to produce some of the worst health outcomes.
According to the Organization for Economic Cooperation and Development, the U.S. spent nearly $14,900 per person on healthcare in 2024, roughly two-and-a-half times the average among OECD countries.
Meanwhile, a Commonwealth Fund comparison of 10 wealthy nations ranked the United States last overall, including for life expectancy and preventable deaths.
Healthcare is consuming an increasingly large share of the American economy, putting growing pressure on families, businesses and government budgets. The United States spends more than $5 trillion annually on healthcare, accounting for roughly 18% of the nation's gross domestic product. In 1970 health care accounted for just 7% of GDP.
This steady expansion means more of the nation's economic resources are going toward hospitals, doctors, prescription drugs, insurance and other medical expenses, leaving less money available for housing, education, infrastructure and other priorities.
Federal projections suggest the problem will intensify. The Centers for Medicare and Medicaid Services estimates that health spending will rise from $5.3 trillion in 2024 to nearly $9 trillion by 2034, consuming 20.6% of the U.S. economy. That would mean more than one in every five dollars spent in the country would go toward health care.
Researchers at Yale University say the country could save hundreds of billions of dollars without completely restructuring its health care system.
Yale economist Zack Cooper, director of the university’s Health Care Affordability Lab, has helped identify 23 targeted reforms that researchers estimate could collectively reduce annual health care spending by approximately $450 billion.
The initiative, called 1% Steps for Health Care Reform, proposes changes including reducing unnecessary nursing home care, expanding childhood vaccination access and eliminating duplicative health care payments.
Guest:
Zack Cooper is with the Yale's Health Care Affordability Lab.
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