NOT POOR, BUT STILL BUR­DENED

Modern Healthcare - - THE WEEK IN HEALTHCARE -

ciently to main­tain its mar­gins, Budzin­ski said. The sys­tem low­ered its cost per unit of ser­vices by 4% for the seven months that ended in Jan­uary.

Peter Cun­ning­ham, a se­nior fel­low with the Cen­ter for Study­ing Health Sys­tem Change who has stud­ied house­hold med­i­cal debt, said the re­sults, though not sur­pris­ing, un­der­scored the toll on house­holds from the na­tion’s steadily climb­ing health­care costs.

“The way that health­care costs have been ris­ing and the fact that work­ers have been ab­sorb­ing a higher share of the costs in the form of higher de­ductibles and co­pays, a lot of peo­ple who think they are well cov­ered are not as well cov­ered” as they might think, said Cun­ning­ham, who also is co-di­rec­tor of quan­ti­ta­tive re­search for the Wash­ing­ton­based health pol­icy cen­ter.

High-de­ductible health plans have grown more com­mon among those in­sured by an em­ployer. Last year, 17% of work­ers were en­rolled in such plans com­pared with 4% six years ear­lier, ac­cord­ing to the Kaiser Fam­ily Foun­da­tion. Mean­while, work­ers cov­ered by health plans with de­ductibles of $2,000 or more in­creased to 12% from 3% dur­ing the same pe­riod.

Cun­ning­ham said house­holds with low and mod­er­ate in­comes with less cush­ion to ab­sorb un­ex­pected bills strug­gle most with med­i­cal debts.

One in 5 in­di­vid­u­als in poverty were in fam­i­lies that had med­i­cal bills they could not pay at all, the CDC data show, though the fig­ures did not dis­tin­guish be­tween in­sured and unin­sured. The same was true for those with in­come slightly above the fed­eral poverty thresh­old. As house­hold in­come climbed, fi­nan­cial dif­fi­culty from med­i­cal bills de­clined. Roughly 1 in 17 in­di­vid­u­als, or 6%, with in­comes at or above 200% of the poverty thresh­old were in fam­i­lies that could not pay med­i­cal bills.

Re­search pub­lished by Cun­ning­ham in In­curred more than $2,000 out- of- pocket Unin­sured Near- poor

Poor Public in­sur­ance

Not poor Pri­vate in­sur­ance In­curred less than $2,000 out- of- pocket De­cem­ber found 1 in 3 nonelderly in­di­vid­u­als in fam­i­lies with low and mod­er­ate in­comes strug­gled with med­i­cal bills. Among the in­sured with low and mod­er­ate in­comes, the per­cent­age re­mained high, at 27% to 28%.

The re­search was based on a na­tion­ally rep­re­sen­ta­tive tele­phone sur­vey in 2010. Sur­veys con­ducted in 2010, af­ter the Great Re­ces­sion drove un­em­ploy­ment up­ward, and 2007, prior to the eco­nomic down­turn, found lit­tle change in house­holds strug­gling with med­i­cal debt.

With fi­nan­cial dis­tress came other trou­bles, in­clud­ing col­lec­tion agen­cies and bor­row­ing to pay off med­i­cal bills, the re­search found. Some with­drew sav­ings. Oth­ers strug­gled to pay for ne­ces­si­ties.

Cun­ning­ham said those with med­i­cal bills were also more likely to put off med­i­cal care out of con­cern for the cost.

Like Cun­ning­ham, Pa­tri­cia Her­man, a re­search sci­en­tist at the Cen­ter for Health Out­comes and Phar­ma­coeco­nomics

The CDC es­ti­mates that mil­lions of house­holds with in­comes more than twice the fed­eral poverty level ($44,700

for a fam­ily of four) are bur­dened by med­i­cal ex­penses Re­search at the Univer­sity of Ari­zona Col­lege of Phar­macy, said she did not find the CDC re­sults sur­pris­ing. Her­man and col­leagues stud­ied 2008 sur­vey data on in­sur­ance cov­er­age and med­i­cal debt in Ari­zona and found in­sured house­holds were as likely as the unin­sured to strug­gle with med­i­cal bills. Her­man praised the CDC re­port for high­light­ing an is­sue she de­scribed as “al­most a se­cret.”

“It’s amaz­ing to me that it’s so preva­lent and dev­as­tat­ing” but so lit­tle stud­ied, Her­man said.

In­deed, the Ari­zona re­search found med­i­cal debt mat­tered more than whether some­one was in­sured when it came to who would be most likely to de­lay or skip needed med­i­cal care, Her­man said. Early re­sults of sub­se­quent re­search sug­gest health plans with coin­sur­ance leave house­holds par­tic­u­larly vul­ner­a­ble to med­i­cal debt, she said. House­holds can plan for co-pay­ments and de­ductibles, but the cost from co-in­sur­ance can de­pend on the med­i­cal care needed when some­one un­ex­pect­edly be­comes ill or in­jured.

Dr. David Him­mel­stein, a pro­fes­sor of public health at the City Univer­sity of New York, said the fault lies not only with the outof-pocket fees such as de­ductibles but cov­er­age and re­im­burse­ment lim­its that also shift more cost to house­holds.

Him­mel­stein is an ad­vo­cate for a sin­gle­payer health sys­tem and co-founder of Physi­cians for a Na­tional Health Pro­gram, and he co-au­thored a 2009 study that found med­i­cal debt con­trib­uted to 62% of U.S. bank­rupt­cies. In an ear­lier study, Him­mel­stein and col­leagues sur­veyed more than 1,700 bank­ruptcy fil­ers and found among those for whom med­i­cal bills were a sig­nif­i­cant fac­tor, 75% were cov­ered by in­sur­ance when they fell ill.

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