Text table 7. Health care expenditures and shares by age of reference person, Consumer Expenditure Survey, 1984 and 1991

T ]
All =| Under | i |
consumer) 25 25-34 | 95-44 | 45-54 | 55-64 | 65and| 65-74 | 75 and
units | over over
Total expenditures |
sees $21,975) $13,461) $22,294| $28,214| $28,696| $23,401} $13,941, $15,842| $11,122
29,614) 16,745) 29,280) 96,446) 98,197] 31,945] 19,692/ 22,564) 15,782
1,049 371 746 976 1,245! 1,255| 1,493) 1,485) 1,504
1991 ...... 1,554 361) 1,030] 1,488} 1,727) 1,846! 2,257, 2,300) 2,197
Share of total expenditures (percent):
1984.0... : 48 28 33 35| 43 54 10.7 94, 135
1991 .. 52 22 35 4.4) 45 58 115 10.2| 13.9
| |
Shares of health care budget (percent): | |
Health care .........0.ce a8 LA 100.0; 100.0) 100.0 100.0} 100.0) += 100.0] 100.0, + 100.0) 100.0
Health insurance | |
1984... 35.3 29.1 33.2 31.0 31.6 36.1 41.6 440/ 37.9
1991.0... 422 39.9 40.5 39.2 36.7; 40.6 49.2 47.0| 52.4
Medical services | |
1984 43.3 50.1 48.4 50.5 49.0 422 32.8 31.4 935.2
1991 35.7 36.3 40.5 42.3 40.9 36.3 25.7 2e2| 20.7
Drugs |
1984 .... 159 15.4 13.4 137) 148 176 186 185; 19.0
1991 esses 16.2 155; 13.3 12.2 15.3 18.4 19.7 183) 217
Medical supplies |
1984 ..... 55 5.9 51 48) 49 45 7.0 64 79
1991 .. 59 83 5.7] 63) 7A 45 54 56 52

share of the total health budget from 43 percent in 1984 to
36 percent in 1991. The CPI for medical services rose 68
percent over this period. These data suggest that HMO’s
and supplemental health insurance are covering services
that were previously paid for out of pocket. However,
medical service expenditures include fees for physician
services, hospital rooms, and nursing home care that tend
to fluctuate more than health insurance.

Health care expenditures make up a larger portion of the
total budget of older consumer units (those age 65 and
older) than of younger consumer units. These expenses ac-
count for almost 12 percent of total expenditures of those
consumer units headed by someone age 65 or older and 2
percent of total expenditures of those consumer units
headed by someone under age 25. Older households have
less income, lower total expenditures, and more costly
health care needs on average than the younger groups.

Within the health care budget, the older groups allocate
a larger portion to health insurance and prescription drugs
and a smaller portion to medical services than do the youn-
ger groups. Older households spent close to 50 percent of
their total health care dollars on health insurance, whereas
the youngest households (those under 25 years old) spent
40 percent. This difference is partially explained by differ-
ences in the percent reporting—93 percent of older con-
sumer units reported health insurance expenditures and
19 percent of the youngest consumers units reported
health insurance expenditures. Much of this gap is ac-
counted for by Medicare expenditures: 86 percent of older
consumer units and none of the youngest consumer units
reported Medicare expenditures.

Comparisons with other data sources

As part of the evaluation of the survey results, BLS com-
pares aggregate expenditure estimates obtained from the
CE survey with alternative, independent sources of data.
Comparisons described here use data integrated from the
two survey components, Interview and Diary, unless
otherwise noted.

Differences in concept and coverage require adjust-
ments to both BLS data and the independent sources to
permit comparison. With these adjustments, comparisons
can be made for many categories of consumer spending.
The degree of concordance varies by component, as noted
in the tables. Data are not shown when differences in con-
cept are so great as to make the comparison meaningless.

Personal Consumption Expenditures in the National In-
come and Product Accounts. Historically, the principal
source of independent estimates used for these compari-
sons has been the Personal Consumption Expenditures
(PCE) component of the National Income and Product
Accounts, prepared by the Bureau of Economic Analysis
(BEA) of the U.S. Department of Commerce. Because the
BEA estimates are expenditure aggregates that cover the
total population, comparisons are made on the basis of
aggregates rather than averages.

The PCE estimates represent the market value of goods
and services purchased by all persons. The estimates are
derived by complex methods which trace the flow of goods
ard services through the economy. Total expenditures of
persons are defined to include expenditures of individuals
and nonprofit institutions. Expenditures of nonprofit in-


Text table 8. Comparison of aggregate expenditures for selected categories of consumption: Consumer Expenditure ‘Survey

and Personal Consumption Expenditures, 1988-91

Consumer Expenditure Survey Ratio of CE to PCE
LL (in billions)
Item _ T
1988 | 1989 | 1990 | 1901 | 1988 1989 | 1990 1991
— —_—

FO00d oe eees eee | 349 390 408 410 | 074 | 078 | 077 075
Food at home . | 202 229 240 259 67 71 70 74
Food away from home’ C446 161 | 168 151 ee) ‘88 76

Alcohoc beverages “| 8 a7 | 28 29 | 38 ‘40 ‘39 39

jousing |
Rent, utes, tel, and pubic services? . | ert 285 297 305 99 9 99 97
jephone .......» 51 54 | 57 61 1.01 1051.08 | 1.14
Household operations? ............. | 20 22 24 23 ‘95 95 ‘86 96
Household furnishings and equipment. | 140 145 149 159 71 69 ‘68 73
Household textiles . 9 40 10 10 46 49 45 46
Furniture .......... a1 30 30 29 ‘9 ‘81 “85 86
Floor coverings : 7 8 40 12 ‘es | 70 ‘81 1.02
Major appliances... -| #8 16 16 15 75 63 63 60
Miscellaneous household equipment : 74 80 83 93 ‘62 | 69 ‘68 74
Apparel and services . S442 152 157 170 ‘81 ‘81 ‘80 86
Transportation ..... : | 367 370 369 382 79 a 72 78
Vehicle purchases® . | 201 196 182 186 ‘92 ‘86 ‘82 92
Gasoline and motor oil en) 94 102 97 | 1.02 ‘98 94 | 92
Cte vehicle expenses® . 53 54 58 70 48 AS 46 54
ublic transportation . 2 25 27 28 ‘54 53 53 55
Entertainment . sees 121 130 129 136 66 65 61 63
Fees and admissions . . 34 36 36 37 86 86 79 80
Televisions, radios, and sound equipment 39 4a 44 46 ‘66 ‘63 ‘64 ‘64
Pets, toys, and playground equipment .. - | 22 24 27 | 26 69 69 | al 7
Other entertainment supplies, equipment . 53 57 44 53 “50 ‘50 ‘38 45
Personal care products and services . | wz) 3% 35 39 ‘61 63 ‘59 ‘63
Reading ...... 734 anes 18 19 49 20 | 50 “50 46 48
Tobacco products and smoking supplies . 23 | 28 27 27 ‘63 ‘62 ‘61 57
Miscellaneous’ devtestesteees | 30 33 | 33 33 | 38 34) 32 31

1 School lunches and meals as pay are excluded.

2 Includes rent for tenant-occupied dwelling units and lodging away from
home and at school. Rent in the CE survey is contract rent, which includes utili-
ties for some renters. In PCE, data are for space rent, which excludes charges
for utilities. The CE survey covers direct costs of utilities and fuels by homieown-
ets and renters. PCE data cover total expenditures for utilities and fuels even if
paid by landlords.

3 Consumer expenditure amounts for babysitting, daycare centers, and
care of invalids or the elderly are excluded.

4 Various subcategories were combined to approximate equivalent content.

5 The PCE concept of dealer margin as the purchase value of used cars
could not be matched. CE survey data on vehicle purchases, trade-ins, and
‘sales were combined to obtain an approximate total for new and used vehicles.

includes vehicle rentals except aircraft rentals, maintenance and re-
pairs, and other vehicle charges except vehicle licenses and registration.

stitutions are not distributed among individual goods. In-
stead, they are included in specific service categories—pri-
marily medical care, education and research, and religious
and welfare activities—categories which are not compared
with consumer expenditures. While the PCE estimates are
not directly subject to the quantifiable sampling errors
found in household surveys, they are subject to errors in
the source data and to difficulties in applying complex pro-
cedures for allocating these data among the final demand
sectors.

BEA conducts periodic, comprehensive revisions of the
NIPA to update methods of estimation and data from the
Census Bureau’s quinquennial censuses and other sources
used in the accounts. PCE estimates from different revi-
sions sometimes differ by large amounts and as a result,
revisions to PCE can affect comparisons with consumer
expenditures substantially. For example, the PCE esti-
mate for gasoline in 1990, which is based on the 1982

10

7 Consumer expenditure for other properties, interest on home equity line of
credit, and finance charges are excluded.

Note: Sums may not equal totals due to rounding. Home ownership costs,
insurance estimates, capital improvements, health care estimates, finance
charges, education expenditures, and cash contributions are excluded from the
comparisons.

Source: PCE data used in the comparisons are from unpublished detailed
tabulations of the National Income and Product Accounts of the U.S. Depart-
ment of Commerce, Bureau of Economic Analysis as of July 1992. These data
include 1982 benchmark estimates. For more information on PCE see U.S. De-
partment of Commerce, Economics and Statistics Administration, Bureau of
Economic Analysis, National Income and Product Accounts of the United
States: Volume 2, 1959-88 (1992), and Survey of Current Business, July issues,
table 2.4, 1989-92.

benchmark estimate (the most recent revision), is $108.5
billion, 16 percent larger than the previous estimate of
$93.7 billion which was based on the 1977 benchmark esti-
mate. This results in a 14-percent decline in the ratio of
consumer expenditures to PCE, from 1.08 to 0.94. In gen-
eral, the ratios in this comparison cannot be compared
with previously published ratios which were obtained us-
ing PCE estimates derived from earlier benchmarks.

Text table 8 shows aggregates for selected expenditure
categories for 1988 through 1991 using integrated CE sur-
vey data, adjusted for comparability with BEA data. The
resulting ratios indicate that the CE survey estimates for
the major categories of consumption are lower than the
PCE estimates. For several major items, the relationship
between the two series has been generally constant over
time. These items include: Food; alcoholic beverages; rent,
utilities, fuels, and public services; apparel; and transpor-
tation, to name a few.


Text Table 9. Comparison of aggregate expenditures for food, Consumer Expenditure Diary Survey, Personal Consumption Ex-
penditures (PCE), Supermarket Business, and Progressive Grocer, 1991

Diary survey Ratio of Ratio of Ratio of
aggregate Diary to Diary to Diary to
Food categories expenditures PCE Supermarket Progressive

(in billions) Business Grocer
Food at home, total .. $255 | 0.74 4.10 1.22
Cereals and cereal 4 | 69 1.09 1.43
Bakery products 25 68 1.06 4.12
Meat including pot 58 83 1.07 4.07
Fish and seafood 8 1.20 | 1.19 2.68
Eggs . . 3 1.47 2.04 1.44
Fresh m 13 1.01 4.74 1.86
Other dairy products . 16 76 1.38 132
Fresh fruits and vege! . 25 92 73 | 92
Processed fruits and vegetab! 16 59 106 | 1.37
‘Sugar and other sweets . 10 37 1.32 2.48
Fats and oils - 7 76 1.09 1.74
Nonalcohol es. 22 53 1.02 1.20
Miscellaneous prepared foods . 37 | 85 1.28 1.16

Source: BLS Consumer Expenditure Survey; Supermarket Business, Consumer Expenditure Study (September 1991); and Progressive Grocer (July 1991).

Detailed food comparisons. Supermarket Business con-
ducts a comprehensive annual survey of food manufactur-
ers, packers, wholesalers, and retailers to construct a de-
tailed picture of grocery store sales by product line. Total
grocery store sales for the study are based on U.S. Bureau
of the Census estimates, and include sales by specialty food
stores. Estimates are also available annually from a similar
study by Progressive Grocer. The Progressive Grocer data
are limited to stores with annual food sales of $2 million or
more, accounting for only 75 to 80 percent of grocery store
food sales.

Text table 9 compares the industry data, as well as PCE
data, with detailed CE Diary survey estimates of food ex-
penditures. These comparisons show that the estimates for
1991 CE food at home expenditures are generally lower
than PCE but that the CE estimates are almost always
higher than those of Supermarket Business and Progressive
Grocer. In the case of the Progressive Grocer estimates, this
is due in part to the truncated store sample, as noted above.
The results shown in text table 9 for 1991 are, in general,
similar to those from previous years.

Residential Energy Consumption Survey. The Energy In-
formation Administration of the U.S. Department of En-
ergy (DOE) publishes data collected in the Residential En-
ergy Consumption Survey (RECS) on expenditures for
electricity, natural gas, fuel oil and kerosene, and liquified
petroleum gas. The data are published triennially. The
RECS focuses on obtaining detailed data from energy
suppliers on residential energy use. To make the compari-
son, time periods and fuel types were matched to the extent
possible. Fuel oil and kerosene are not compared because
of differences in how the items are categorized and the in-
clusion of expenditures for wood fuel in RECS.

The data in text table 10 show aggregate expenditures
and ratios from the two surveys for periods back to 1984.
Some difference between the CE survey and RECS is to be

expected because imputations are made in the DOE sur-
veys for money value of utilities included in residential
rents. In addition, the RECS covers military households
who live on base, but the CE survey does not include such
households. The 1990 data show that consumer expendi-
ture estimates for natural gas and electricity combined are
very close to those from the Energy Department survey.
The consumer expenditure estimate for electricity expen-
ditures, which is 3 percent higher than the RECS estimate,
more than offset the lower expenditure amount for natural
gas.

National Health Accounts. The Health Care Financing
Administration (HCFA) of the U.S. Department of
Health and Human Services publishes total aggregate
health costs of the United States in the National Health
Accounts (NHA). Total health care costs include pay-
ments from all sources, public and private. The CE survey
data are compared with the out-of-pocket expenditures in
the NHA. Out-of-pocket expenditures for health care in-
clude copayment and deductible amounts required by
third party payers (governments, commercial insurance
companies, and other nonhousehold sources) and medical
care services and products not covered by third parties. To
derive the out-of-pocket estimates, HCFA uses CE data
along with data from administrative and industry sources.
For the comparisons, estimates of insurance premiums are
based on detailed data in NHA on the financing of health
care.
Text table 11 shows a comparison of aggregate out-of-
pocket health care expenditures from the CE survey and
NHA. Expenditures by patients in nursing homes, which
are not covered in the CE survey, are excluded from the
comparison. Because of methodological changes in NHA,
ratios in the comparison below should not be compared
with those published in earlier bulletins.

As reported in the CE survey, aggregate health care ex-
penditures were $150 billion in 1991, or about 73 percent