Most people spend nearly 1.5 times more in a year on healthcare than what they estimate and potentially plan for, says a new study.
The Lifetime of Healthcare Costs study sponsored by Synchrony Financial also found that four out of five respondents do not have savings to cover medical emergencies.
Interestingly, only 19% of baby boomers have medical debt that they can’t pay off or worry about paying off (and that could be because more than half of them now qualify for Medicare). That percentage compares to 34% of Gen X and millennials, and 23% of Gen Z.
The study also found that an insured American with an employer-sponsored health insurance plan can expect to spend more than $320,000 on health care over his/her adult lifetime. Synchrony came up with that total by taking annual costs — $1,321 out-of-pocket expenses, $776 in co-insurance and $3,180 in insurance premiums — and multiplying it by 61 years.
Total health care costs over a lifetime could be more than double — nearly $700,000 — for Americans who purchase their own insurance (without employer or government subsidies) or for those who suffer from chronic illnesses such as diabetes, heart disease or cancer, the study said.
The study also found that the high costs of healthcare are causing people to consider delaying or forgoing recommended care and treatment and forcing them to choose between financial health and physical/mental well-being:
• 50% of Gen Z, millennials and Gen Xers, on average, said they would consider postponing non-urgent medical care if the cost is $500-$999.
• 32% of Boomers said they would consider postponing non-urgent medical care if the cost is $500-$999.
• 25% of Gen Z, millennials and Gen Xers, on average, said they would consider delaying non-urgent medical care that costs less than $500.
• 65% of millennials and 60% of Gen Xers said they were not financially prepared for their most costly out-of-pocket healthcare expense.
ASQ360° Market Research/Stephens & Associates performed the study for Synchrony. Researchers surveyed 3,176 respondents, including 592 members of Gen Z (born after 1996), 796 millennials (born 1977 to 1996), 791 members of Gen X (born 1965 to 1976), 836 baby boomers (born 1946 to 1964) and 161 members of the Silent Generation (born before 1946). The survey was conducted in July and August 2022.
Synchrony (NYSE: SYF) is a consumer financial services company headquartered in Stamford, Conn. Among other things, it offers CareCredit, a consumer credit card for medical needs.