Do%20medical%20out-of-pocket%20expenses%20thrust%20families%20into%20impoverishment?

1
Do medical out-of-pocket expenses thrust families
into impoverishment?

• Brett OHara
• Social Security Administration
• Brett.OHara_at_SSA.gov

2
Having Health Insurance

• 84 of the US population was covered by health
  insurance in 1996
• Take-up rates from employer provided health
  insurance is declining
• 88 to 80 decline between 1987 and 1996 (MEPS)
• Health insurance does not provide full protection
• Costs of prescription medication rising and often
  not covered
• Fixed copayments (80/20) combined with higher
  healthcare costs have a higher impact on families
• Underinsurance preexisting conditions and
  lifetime caps

3
Not Having Health Insurance

• Less likely to use medical services when needed
• Delayed treatment more expensive for the family
• Untreated health problems lead to lower work
  productivity and lower earnings
• Medical services and medications are more
  expensive for a non-insured person
• Health insurance companies negotiate lower prices
• More likely to use emergency care
• Expensive for the family and society

4
National Academies of Science

• Report on poverty measurement
• Poverty measures should focus on resources
  available to the family
• Because medical out-of-pocket (MOOP) expenses
  must be paid, these expenses should not be
  counted as available resources
• Report on health insurance
• Health insurance is essential to financial
  stability

5
Research Objective

• Is there a significant impact on family
  well-being from medical out-of-pocket expenses
• Data SIPP, calendar year 1996
• Impoverishment

6
Defining Impoverishment

• Impoverished
• Subtract MOOP from total family income
• Compare to the poverty threshold
• Conservative measure
• Population used in the majority of the analysis
• Included All families that are not already in
  poverty
• Excluded Families in poverty

7
(No Transcript)
8
(No Transcript)
9
(No Transcript)
10
(No Transcript)
11
(No Transcript)
12
(No Transcript)
13
Conclusion

• MOOP impoverishes 4 of non-poor families
• Families are more likely to be impoverished if
• Head of the family is in poor health or older
• Some adults are without health insurance or
• Families without a person that worked full-time
  for the entire year.

14
Policy Implications

• People who do not have health insurance are
  inadequately protected
• They need coverage to prevent large expenses that
  the family cannot afford
• Expansions in public health insurance for
  low-income families
• State Childrens Health Insurance Program (SCHIP)
• Current Medicaid Infrastructure Grants

15
Limitations

• Data
• Medical debt
• Before SCHIP (1997)
• Exclusion of U.S. tax policy
• MOOP over 7.5 of gross income can be deducted
• Federal Savings Accounts (FSA)
• Definition of impoverishment
• Could use a relative definition
• E.g., MOOP20 of family income then
  impoverished