This study examines the current allocation of medical care expenditures among non-Hispanic white, non-Hispanic black, and Hispanic seniors who are Medicare beneficiaries. Analyses of both need-based and demand-based perspectives found that white, black, and Hispanic seniors in similar health had similar total annual expenditures for medical care. The groups did, however, differ substantially in the distribution of expenditures between public and private sources of payment. Notably, racial and ethnic differences in public and private expenditures all but vanished when socioeconomic variables and health insurance coverage were included in the analyses. The findings suggest that public sources of payment for medical care services, especially public supplementary coverage, have helped to eliminate racial and ethnic gaps in expenditures.
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