Tuesday, December 18, 2012

Unpaid Caregiving in U.S. Valued at $492 Billion

Source: Chart from "The hidden costs of U.S. health care; Consumer discretionary health care 
spending" 2012 study from the Deloitte Center for Health Solutions

A new report from the Deloitte Center for Health Solutions estimates that the total of all U.S. health-related expenditures in 2010 totaled $3.2 trillion or about 23 percent higher than reported in the National Health Expenditure Accounts (NHEA).

Included in the "hidden costs" is $492 billion that Deloitte estimates is the value of the work of the nation's 42.4 million unpaid caregivers. 

How was this value calculated?

The formula is simple: Number of caregivers X hours of care per caregiver per week X economic value of one hour X 52 = Total "imputed" value 

The study found that there is approximately 3.2 million unpaid caregivers for special needs children (under age 18) and 39.2 million unpaid caregivers for people over age 18. Interesting and not too surprising, special needs children require an average of 33.7 hours of care per week while recipients over 18 require considerable less, 17.4 hours on average.

And what was the value of one hour of caregiving? 

The answer is $11.94. 

This number comes from a "national compensation survey" that found the mean hourly wage of employees whose occupation is "nursing, psychiatric, at home health aides" to be, yes, $11.94. 

Not a great way to make a living, I might add.

Some other interesting numbers related to unpaid caregiving from the study:
  • 51% of unpaid care recipients have household incomes of $0 to $25,000.
  • 41% of unpaid care recipients live in 2 person households.
  • Care recipients from low-income households account for more than 10X the cost of care in the highest income ($100,000 and up).
  • Baby boomers and seniors account for 75% of supervisory care costs. Children who require supervisory care account for 14%.
You can download the entire study here.

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