Today, we're going to follow up an observation we made when we examined the major trends for how the consumer spending patterns of Americans has changed from 1984 through the present, where we observed that since 2009, increases in expenditures for health insurance are being paid for by the reduced consumption of entertainment.
Let's start first by focusing just on the trends in consumer spending for the larger categories of Health Care and Entertainment. The chart below shows that from 1984 through 2009, the share of average annual total expenditures for both these items were less than one percent of total spending different from one another. But after 2009, that difference grew beyond that margin as something clearly changed to cause spending on the Health Care category to increase at the expense of the Entertainment category.
Consumer Expenditure Survey provides some details on the components of spending that make up both the general Health Care and Entertainment categories. Focusing on the period since 2008, we've identified and broken those items out in the following chart, in which we've calculated the actual change in the dollar values of each of these components since 2008:
What we observe is that since 2008, consumer expenditures for health insurance has begun growing at an exponential rate, which we observe in the curving up trajectory of this category of spending, to where by 2013, average consumer expenditures for health insurance has increased by nearly $600 above their recorded 2008 level.
We also see that spending has increased by much lesser amounts in two other components of the general Health Care category, Medical Services and Medical Supplies. Both however are within $100 of what the average expenditures were for each in 2008. Meanwhile, we observe that spending for drugs, such as prescription medication, has been essentially flat since 2008.