Delaware Health Care Spending Grows to $11.3 Billion Statewide

DELAWARE – A new report from the Delaware Department of Health & Social Services (DHSS) indicates per capita health care spending in the state increased to $11.3 billion in calendar year 2024, an increase of about 8.7 percent compared to 2023.

On a per capita basis, spending grew between 6.4 percent and 12.2 percent. Overall, spending growth significantly exceeded the state’s 3.0 percent spending benchmark, according to the DHSS’s sixth annual Health Care Benchmark Trend Report presented Thursday, May 7, to the Delaware Health Care Commission. For this report, DHSS collected final CY 2023 and new CY 2024 data from commercial insurers, Medicaid, Medicare, the Veterans Health Administration, and the net cost of private health insurance.

“The continued growth in health care costs underscores the urgency of this moment,” DHSS Cabinet Secretary Christen Linke Young said. “We must make care more affordable while ensuring every dollar is delivering better health for Delawareans. That means driving rapidly towards multi-payer value-based care transformation, so that hospitals, clinicians, insurance companies, and the government all face the same incentives to deliver the best health outcomes at the lowest cost.”

This year’s report also introduces a new methodology for calculating per capita spending, incorporating enrollment data submitted by payers instead of using census-based population estimates. Using this updated approach, the increase in per capita spending is more pronounced and reflects shifts in coverage and enrollment following the end of pandemic-era Medicaid continuous coverage requirements.

All major markets—commercial, Medicaid, Medicare, and the Veterans Health Administration—saw increases in spending. Key drivers include inflationary pressures, rising pharmaceutical costs, increased hospital spending, and higher utilization of behavioral health services. Hospital inpatient and outpatient services alone accounted for more than $3.9 billion, or nearly 36 percent of total medical expenditures. However, Medicare continues to represent the largest share of health care spending in Delaware, accounting for roughly 42 percent of total expenditures. Delaware’s aging population and shifting enrollment trends also contributed to rising per capita costs.

“Delaware’s clinicians and health systems deliver outstanding care every day, but the trajectory of health care spending makes clear that incremental change is no longer enough,” said Dr. Neil Hockstein, Chair of the Delaware Health Care Commission. “To preserve access and affordability over the long term, we must fundamentally transform how care is delivered and paid for — the future sustainability of our health care system depends on aligning incentives around better outcomes, prevention, and keeping people healthy rather than simply delivering more services.”

Delaware remains one of eight states to establish a statewide health care cost growth benchmark, a target for the annual increase in per capita health care spending. The benchmark is designed to align health care cost growth with broader economic conditions.

To view the full report, click here.