Statistics from the U.S. Bureau of Labor Statistics show healthcare costs have risen 160 percent from 1950 to 2014.
The percentage of average yearly income going toward healthcare costs has risen 160 percent since 1950, according to an analysis of data from the U.S. Bureau of Labor Statistics.
By 2014, the first year all Americans had to purchase health insurance under Obamacare, healthcare costs accounted for 13.5-percent of average annual expenses ($7,221) for an American family, up from 5.2-percent in 1950, an increase of 8.3 percentage points.
Back in 1950, one New Jersey newspaper, the Hunterdon County Democrat, opined against creating compulsory health insurance. In an editorial, the newspaper said families could instead cut back on other expenses, such as "alcohol, liquor and entertainment" to help pay medical costs.
Home prices jumped 430-percent in this county
During this time there was "much talk of the heavy burden of medical expense to the average family. Yet only 5.2-percent ($197) of the average family income goes to pay doctor bills."
The Democrat went on to state: "Most American families have the resources to pay for adequate medical care if they would give it the priority it deserves. We don't want or need compulsory health insurance. It would result in a tragic deterioration of the present high standards of our medical profession. Its cost to the nation both in dollars and personal liberty would be intolerable."
Back in 1950, the Democrat reported that the average American family spent 7.9-percent of its average annual income of $4,237 on liquor ($65), entertainment ($168) and tobacco ($68). The information came from the U.S. Bureau of Labor Statistics. Total expenditures were $3,808.
The average cost of personal insurance, the bulk of which was life insurance, was $177 per year, or 4.5-percent. The number at that time included health insurance, but few policies were available.
By 2014, the average annual before tax income had risen to $66,877 and the average annual expenses were $53,495. Of this, 6.9-percent now went toward alcohol, entertainment and tobacco. The totals in 2014 were .9-percent ($439) spent on alcohol, 5.4-percent ($2,966) going toward entertainment and .6-percent ($330) spent to purchase tobacco, according to the U.S. Bureau of Labor Statistics.
Average out-of-pocket healthcare costs had risen to 8-percent ($4,290), while the average cost of health insurance was $2,868 per year (5.5-percent). The average cost of personal insurance, which now included pensions, was $5,727, or 11-percent of average annual expenses.
This represented an increase of 2.8-percent in out-of-pocket healthcare costs from 1950 to now, and an increase in personal insurance of 6.5-percent.
One number that has also increased is the amount of disposable income, or funds left over after all expenses: It was $429 (or 10-percent) back in 1950 and had risen to $13,382 (20-percent) by 2014.
The three biggest expenses in both 1950 and 2014 were food, housing and transportation. Food accounted for $1,130 (29.7-percent) in 1950, housing was $1,035 (27.2-percent) and transportation was $510 (13.4-percent).
However, by 2014, the percentage of income going toward food went down to 12.7-percent ($6,759), housing had risen to 32.6-percent ($17,798) and transportation increased to 17-percent ($9,073).
The percentage of income dedicated to apparel and service expenses also dropped from 1950 to today: From $435 (11.5-percent) in 1950 to $1,786 (3.5-percent) today.