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 presents the total "Percent Spending 10% or More of Family Income on Out of Pocket Expenditures." The vertical axis, percent, goes from 14 to 19.5 and the horizontal axis, year, goes from 2001 through 2005. The results:

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

Slide 7

The line graph presents the "Percent Spending 10% or More of Family Income by Insurance Status." The vertical axis, percent, goes from 0 to 60 and the horizontal axis, year, goes from 1 to 5. The results:

• Private:
  • 1: 14.7%
  • 2: 16.0%
  • 3: 17.8%
  • 4: 17.0%
  • 5: 18.6%
• Private Non-Group:
  • 1: 39.0%
  • 2: 49.1%
  • 3: 55.3%
  • 4: 52.7%
  • 5: 52.9%
• Public:
  • 21: 18.0%
  • 2: 18.0%
  • 3: 19.5%
  • 4: 15.8%
  • 5: 16.5%
• Uninsured All Year:
  • 1: 13.9%
  • 2: 13.7%
  • 3: 13.5%
  • 4: 14.0%
  • 5: 15.0%

Slide 8

The line graph presents the "Percent Spending 10% or More of Family Income by Poverty Status." The vertical axis, percent, goes from 0 to 40 and the horizontal axis, year, goes from 2001 through 2005. The results:

• 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% plus):
  • 2001: 7.2%
  • 2002: 8.2%
  • 2003: 9.0%
  • 2004: 10.2%
  • 2005: 11.3%

Slide 9

The line graph presents the "Percent Spending 10% or More of Family Income by Age/Gender." The vertical axis, percent, goes from 0 to 35 and the horizontal axis, year, goes from 2001 through 2005. The results:

• 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 presents the "Percent Spending 10% or More of Family Income by Insurance Status and Chronic Condition." The vertical axis, percent, goes from 0 to 30 and the horizontal axis, year, goes from 2001 through 2005. The results:

• 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.