Racial Spending Gap in Health Care Favors White Americans, Study Finds

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Key Takeaways

  • A new study shows that White people spend disproportionately more on health care than people of color in the United States.
  • Data shows that Black people spend more on emergency department and inpatient care while White people spend more on primary care and prescriptions.
  • Researchers suggest that boosting spending and access to care for under-represented groups could improve health outcomes.

A new study found that White people spend disproportionately more than people of color for healthcare services in the United States. Researchers said the results imply a need for equitable health care access and more funding for preventative care.

“I really see our study, despite it being about healthcare spending, really to be about access to primary health care,” Joseph L. Dieleman, PhD, associate professor in the Department of Health Metric Sciences at the University of Washington and lead author of the study, said at a press conference.

The study is part of the Disease Expenditure Project at the Institute for Health Metrics at Evaluation, which evaluates how healthcare dollars are spent each year. Researchers looked at self-reported data from more than 7.3 million health system visits, admissions or prescriptions from 2002 to 2016.

The results showed that White patients accounted for 72% of healthcare spending in 2016, compared to 11% among African American patients, 11% among Hispanic patients, and 3% among Asian, Native Hawaiian and Pacific Islander patients.

In the same year, 61% of the U.S. population were White, 18% were Hispanic, 12% were African American, and 6% were Asian, Native Hawaiian, and Pacific Islander.

Spending associated with African American patients was most proportional to population size, but the types of services they received represented discrepancies in quality and access to care, Dieleman said.

For example, hospital and emergency department care were most associated with people of color, whereas dental care and prescription pharmaceuticals—what Dieleman described as the “hallmarks” of the primary care system—were more associated with White people.

He stressed the need for providers to prioritize these hallmark services for people of color.

“Moving forward, it seems like timely access to high quality primary health care is not only critical for improving health outcomes across the country, but also may lead to a more equitable distribution of healthcare resources,” Dieleman said.

Limitations of the Study

The study examined all types of payers, including private insurance, public insurance, and out-of-pocket spending. Researchers disaggregated the spending data by race and ethnicity, but not by payer. 

Had the researchers been able to compare this element, they could have better understood the role of insurance coverage and out-of-pocket expenditure in these spending differences, Dieleman said.

“In some ways we're left to look at the context of what we know from other studies about health insurance coverage and where resources are coming from,” Dieleman said. “We recognize that that's a spot for improvement.”

Still, he noted that a person’s insurance coverage or lack thereof does not explain all the racial discrepancies in healthcare spending. Factors like social determinants of health and systemic inequalities play a significant role as well, he added.

Amelie G. Ramirez, DrPh, MPH, director of the Institute for Health Promotion Research and the Salud America! program at UT Health San Antonio, said that high insurance costs pose barriers for some people of color, including some of her family members. She added that implicit racial bias from healthcare providers can widen these disparities for people with or without insurance.

“In underserved communities, we often face shortages of qualified health providers,” Ramirez said at the press conference. “While the U.S. may boast about having some of the world's most advanced and innovative hospitals, medical schools, and therapies, not everyone is getting equal access to these advances.”

Will Increased Spending Improve Health Outcomes?

Higher healthcare costs do not always equate to higher quality of care. Proportional to the economy, the U.S. spends twice as much on healthcare as other high-income countries, yet has a lower life expectancy and higher number of preventable hospitalizations and deaths, according to The Commonwealth Fund.

The connection between lower spending and lower quality of health is more clear from the study results, Dieleman said. He stressed the need to increase access among the populations associated with lower spending.

“The question is—are those groups getting access to the care that they need?” Dieleman said. “Are those groups getting access to primary care that can prevent or manage care that would potentially lead to premature mortality?”

The Pandemic's Impact on Health Care Access

Ramirez said that many people of color were frontline workers and were exposed to the coronavirus early in the pandemic.

“They really didn't have a chance to get care,” she added. “They came home, they were exposed, they lost their lives due to COVID.”

In September 2020, a report from National Nurses United found that more than 30% of registered nurses who died from COVID-19 were Filipino Americans, despite Filipino nurses accounting for only 4% of the U.S. nursing population. 

Nearly one-third of all nursing assistants and home health aides in the U.S. are Black women, according to the Center for American Progress. Clinic hours do not always cater to the schedules of people who work two jobs or night shifts, she adds. Advocating for clinics to hold longer or different hours could help increase access for these groups, Ramirez added.

“COVID itself really shines the light on many of the issues that our communities of color are facing,” Ramirez said. “We can't turn our backs on them.”

In 2020, multiple government and public health entities declared racism as a public health crisis. If they haven’t already, she encourages people to advocate for their local governments to do the same.

George Mensah, MD, FACC, director of the Center for Translation Research and Implementation Science within the National Heart, Lung, and Blood Institute at the National Institute of Health (NIH), said that the events of 2020 and 2021, combined with the study findings, demonstrate a need to address underlying barriers to healthcare.

A major focus should be reducing barriers to access and conducting outreach for vulnerable populations, he added. 

“We probably need to stop thinking of always finding ways to tell patients to go to the doctor,” Mensah said. “Let's find strategies that take the care to the community, to the patients.”

“It's very clear to all of us that there isn't any silver bullet,” Mensah added. “We're going to need a comprehensive set of actions that can address these, and they have to do with active community engagement, outreach, [and] addressing misinformation.”

What This Means For You

Increasing healthcare spending doesn't always lead to better health outcomes, but it's crucial to increase health care access for underserved communities with active community outreach.

The information in this article is current as of the date listed, which means newer information may be available when you read this. For the most recent updates on COVID-19, visit our coronavirus news page.

1 Source
Verywell Health uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Dieleman JL, Chen C, Crosby SW, et al. Us health care spending by race and ethnicity, 2002-2016JAMA. 2021;326(7):649-659. doi:10.1001/jama.2021.9937

By Claire Wolters
Claire Wolters is a staff reporter covering health news for Verywell. She is most passionate about stories that cover real issues and spark change.