Financial Burdens for Health Care

AHRQ 2008 Annual Conference

Slide 1

Financial Burdens for Health Care

Jessica Banthin, Ph.D.
Didem Bernard, Ph.D.
September 9, 2008

Slide 2

Research Questions

• How have rising health care costs affected family budgets?
• How does risk of high out of pocket health care burdens vary by:
  • Insurance status.
  • Income categories.
  • Age and gender.
  • Presence of chronic conditions.

Slide 3

Data: Medical Expenditure Panel Survey (MEPS)

• The MEPS is annual survey sponsored by Agency for Healthcare Research & Quality.
• Nationally representative household survey consisting of 15,000 households and 39,000 individuals.
• Includes data on insurance coverage, health care utilization and expenditures, health status, medical conditions, & more.
• Most accurate source of nationally representative micro level data on out of pocket spending for medical care.
• Released on public use files, tables, statistical briefs: http://meps.ahrq.gov

Slide 4

Methods: Constructing Measure of High Burden

• Numerator: We calculated total out of pocket spending across all individuals in the family.
• Denominator: We calculated total family income and adjusted for taxes.
• We identify individuals living in families that spend more than 10% of family income on out of pocket expenses—"high burden."
• Results are presented in terms of percent of individuals living in families with high financial burdens.

Slide 5

Methodological Considerations

• Burden ratio (% of family income) is a composite or summary measure compressing many variables into one ratio.
• Provides big picture—no causal interpretation.
• Combines out-of-pocket (OOP) premiums plus OOP payments on services.
• Defines burdens at family level because family members share resources.
• Use 10 percent of adjusted family income as reasonable threshold, other thresholds can be used.

Slide 6

The line graph shows the percent of individuals spending 10% or more of family income on out of pocket expenditures from 2001-2005.

• 2001: 15.9%
• 2002: 17.2%
• 2003: 18.9%
• 2004: 17.9%
• 2005: 19.1%

Slide 7

The line graph shows the percent of individuals spending 10% or more of family income by insurance status from 2001-2005.

• Private Employer-sponsored Insurance (ESI):
  • 2001: 14.7
  • 2002: 16.0
  • 2003: 17.8
  • 2004: 17.0
  • 2005: 18.6
• Private Non-Group:
  • 2001: 39.0
  • 2002: 49.1
  • 2003: 55.3
  • 2004: 52.7
  • 2005: 52.9
• Public:
  • 2001: 18.0
  • 2002: 18.0
  • 2003: 19.5
  • 2004: 15.8
  • 2005: 16.5
• Uninsured All Year:
  • 2001: 13.9
  • 2002: 13.7
  • 2003: 13.5
  • 2004: 14.0
  • 2005: 15.0

Slide 8

The line graph shows the percent of individuals spending 10% or more of family income by poverty status from 2201-2005.

• Poor (<100%):
  • 2001: 30.3
  • 2002: 31.4
  • 2003: 33.6
  • 2004: 28.1
  • 2005: 29.0
• Low Income (<200%):
  • 2001: 22.9
  • 2002: 21.4
  • 2003: 24.2
  • 2004: 23.8
  • 2005: 21.9
• Lo-Middle (<300%):
  • 2001: 20.3
  • 2002: 22.9
  • 2003: 25.1
  • 2004: 21.1
  • 2005: 23.4
• Hi-Middle (<400%):
  • 2001: 14.3
  • 2002: 17.0
  • 2003: 19.0
  • 2004: 16.3
  • 2005: 21.9
• High Income (400%+):
  • 2001: 7.2
  • 2002: 8.2
  • 2003: 9.0
  • 2004: 10.2
  • 2005: 11.3

Slide 9

The line graph shows the percent of individuals spending 10% or more of family income by age/gender from 2001-2005.

• Less than 18:
  • 2001: 15.4
  • 2002: 16.8
  • 2003: 18.2
  • 2004: 16.0
  • 2005: 17.6
• Males 19-34:
  • 2001: 9.0
  • 2002: 10.6
  • 2003: 11.5
  • 2004: 10.6
  • 2005: 12.1
• Females 19-34:
  • 2001: 13.6
  • 2002: 15.0
  • 2003: 16.9
  • 2004: 14.9
  • 2005: 16.7
• Males 35-49:
  • 2001: 14.0
  • 2002: 15.0
  • 2003: 16.0
  • 2004: 14.9
  • 2005: 16.9
• Females 35-49:
  • 2001: 16.5
  • 2002: 16.9
  • 2003: 18.9
  • 2004: 18.4
  • 2005: 19.5
• Males 50-64:
  • 2001: 21.5
  • 2002: 22.6
  • 2003: 25.3
  • 2004: 25.4
  • 2005: 25.8
• Females 50-64:
  • 2001: 26.6
  • 2002: 27.9
  • 2003: 30.7
  • 2004: 30.3
  • 2005: 30.2

Slide 10

The line graph shows the percent of individuals spending 10% or more of family income by insurance status and chronic condition from 2001-2005.

• INSRD_CHR:
  • 2001: 19.79
  • 2002: 21.52
  • 2003: 24.84
  • 2004: 23.08
  • 2005: 24.42
• INSRD_NON:
  • 2001: 13.2
  • 2002: 14.32
  • 2003: 15.1
  • 2004: 13.73
  • 2005: 15.31
• UNINSRD_CHR:
  • 2001: 25.43
  • 2002: 25.77
  • 2003: 25.28
  • 2004: 25.63
  • 2005: 26.67
• UNINSRD_NON:
  • 2001: 8.82
  • 2002: 8.15
  • 2003: 8.23
  • 2004: 8.56
  • 2005: 9.32

Slide 11

Financial Burdens by Chronic Disease 2003

Likelihood of facing high financial burden:

• All persons, 19.2%
• Diabetes, 39.1%
• Stroke, 56.0%
• Heart disease, 32.7%
• Hypertension, 30.9%
• Arthritis, 30.7%
• Mental disorder, 29.2%

Slide 12

Conclusion

• Tracking trends in high financial burdens provides policymakers with overview of issue.
• Identifies subgroups with elevated risk for high burdens.
• Helps inform debate on affordability issue.
• Also provides benchmark against which to measure proposed changes in policy.