Experts estimate that by 2020 almost half of all Americans will have a chronic illness and 24 percent will have more than one. But how prevalent are chronic conditions today? This study addressed that question using the 1998 Medical Expenditure Panel Survey (MEPS), which compiled health data by interviewing a nationally representative sample of more than 24,000 Americans. The authors report that 45 percent of the working-age population and 85 percent of seniors have at least one chronic illness. Caring for those disorders accounts for 78 percent of all health spending. The article recommends changes in the health system—for example, more emphasis on preventing chronic disorders and better coordination of care for patients with multiple disorders who must see multiple providers. The authors also suggest altering financial incentives to support ongoing care. They point out that insurance benefits often end when patients are no longer improving and resume when they deteriorate again, rather than paying for measures to prevent the deterioration. The authors caution that their findings probably underestimate both the number of people with chronic conditions and the cost of their care because the MEPS did not include individuals who live in institutions such as nursing homes.