Introduction

For the first time since 2017, the federal government has released health care spending data by state. The data, available for 1991 to 2020, cover spending on personal health care (PHC), which includes goods and services, such as hospital care, physician services, and prescription drugs, but excludes the net cost of health insurance, government administration, public health activities, and investment.

In 2020, California PHC spending totaled $405 billion and accounted for 12% of total US PHC spending. On a per capita basis, California health care spending ($10,299) surpassed the US average ($10,191) for the first time since 1991.

Between 2010 and 2020, health care spending in California grew faster on an annual average basis than health spending in the US and the economic growth in the state.

1. Health care spending in California totaled $405 billion in 2020, or $10,299 per person.

In California, private health insurance ($125 billion) accounted for the largest portion of health spending, with Medicare and Medi-Cal each paying $87 billion. Private health insurance per enrollee ($5,302) was lower than both Medi-Cal ($7,929) and Medicare ($13,564) spending. (Note that Medi-Cal figures exclude Children Health Insurance Program and fully state-funded spending.)

2. Overall per capita health care spending in California was slightly higher than US levels in 2020.

Per capita health care spending in California totaled $10,299, slightly higher than the US average. Medicare spending per enrollee was 10.5% ($1,300) higher in California than the US.

3. In 2020, California per capita spending edged past the US average, closing the longstanding gap.

In 2010, California’s $6,480 health care spending per capita was $572 (8.1%) below the US average. However, by 2020, its spending increased to $10,299; 1.1% above the US average.

4. California health care spending per capita has grown faster than the US.

Between 2010 and 2020, California’s health spending per capita grew on average 4.7% per year, exceeding the US rate of 3.8%. Similarly, over the five-year period 2015 to 2020, California’s per capita spending grew at an average annual rate of 5.2%, more than a percentage point faster than the US (4.1%). The 2020 difference between California (7.0%) and US (5.4%) per capita growth rates was even greater.

5. Between 2010 and 2020, aggregate and per enrollee spending growth in California’s Medi-Cal program was higher than spending growth in Medicare and private health insurance.

Between 2010 and 2020, aggregate Medi-Cal health spending grew at an annual average rate of 7.6% per year, higher than all spending (5.3%), private health insurance (4.6%), and Medicare (5.1%). Medi-Cal per enrollee growth averaged 5.4% over the same period, higher than private health insurance (3.5%) and Medicare (2.0%).

6. Health care spending per capita varied greatly by state, from 26% below the US average in Utah to 37% above the US average in New York.

In 2020, health care spending per capita ranged from $7,522 in Utah to $14,007 in New York. California per capita spending was similar to the national average and ranked 29th out of 50 states (where 1st is lowest). Data for all 50 states are available in the downloadable files below.

7. Private health insurance accounted for the largest share of health care spending in California in 2020.

In both California and the US, private health insurance accounted for about 30% of personal health spending in 2020. The share of Medicaid spending was slightly higher in California than in the US (21% vs. 17%).

8. Nearly two-thirds of California health care spending went toward hospital care and physician and clinical services in 2020.

In 2020, more than one third of personal health care spending in California was for hospital care. Physician and clinical services accounted for another 26%. Nursing home facilities and home health care each represented 5% of health care spending in the state.

9. Spending growth varied by category.

Between 2010 and 2020, other health, residential, and personal care had an average annual growth rate of 11%.

The quick reference guide on California spending and a companion data file are available for download below.

These materials are part of CHCF’s California Health Care Almanac, an online clearinghouse for key data and analyses describing the state’s health care landscape. See our entire collection of current and past editions of Health Care Costs 101.