The Future of Children, Princeton - Brookings: Providing research and analysis to promote effective policies and programs for children.

The 1987 National Medical Expenditure Survey (NMES) Household Survey is the primary source of the expenditure estimates provided in this report.³ With a total sample of about 35,000 individuals in 14,000 households, this survey is designed to provide estimates of the health status, use of health services, expenditures, sources of payment, and insurance coverage of the U.S. civilian population for the calendar year 1987. Each family in the survey sample was interviewed five times during 1987 and 1988 to obtain detailed, accurate information about each family member's health and health care utilization during 1987. To verify and supplement the information provided by the household respondents, separate surveys were performed on the medical care and health insurance providers of the households in the sample.⁴ Special tabulations of individual NMES data on the utilization, cost, and source of payment for health care aggregated by age groups are the basis of the estimates reported in this article.⁵

Baseline data for explorations of trends in health care costs over the 10-year period 1977–1987 are obtained from the 1977 National Medical Care Expenditure Survey (NMCES). Similar in design to the 1987 NMES, the 1977 NMCES also supplemented multiple interviews of individuals in 14,000 households with information from health care providers, employers, and insurance companies to provide a comprehensive statistical picture of how health care services were used and paid for by the U.S. noninstitutionalized population in 1977.⁶

Both the NMCES and the NMES tabulations used in this analysis follow the NMCES procedure of not treating the stays of newborns delivered in hospitals as separate admissions unless the infant remained in the hospital beyond the day on which the mother was discharged.⁷ Thus, in the NMES data, the costs associated with uncomplicated births (typically those in which the infant is discharged at the same time as the mother) are attributed to the mother, and the costs of complicated births (those where the infant remains in the hospital after the mother is discharged) are attributed to the infant and tabulated in the cost of medical care for children less than 2 years old. Because we could not obtain specific data on expenditures for all pregnancies in both the NMCES and NMES, our estimates of the costs of pregnancy are constructed from a variety of data sources and reported in a separate section.⁸

In the analysis that follows, we use the 1987 NMES to analyze health care expenditures for children by type of service, age of child, and sources of payment. We also compare expenditures on children's health care with expenditures on health care for adults and examine the source of growth in expenditures on children's health between 1977 and 1987. We then turn to a separate analysis of expenditures for pregnancy and infant health care.