Press Release

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March 25, 2010
12:01 AM PST

Sue Ducat
Director of Communications
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From Health Affairs

For More Americans, Health Care Costs At Least 10 Percent Of Family Income


Bethesda, MD - A new paper published today by Health Affairs demonstrates that a growing number of Americans between 2001 and 2006 faced a high financial burden from health care expenses, a burden defined as spending more than 10 percent of their before-tax income on insurance premiums and medical care. In addition, almost 30 percent of the U.S. population either incurred these high costs or were uninsured.

The Growing Financial Burden Of Health Care: National And State Trends, 2001-2006

By Peter J. Cunningham

Cunningham is with the Center for Studying Health System Change in Washington, DC. The study was
funded by The Commonwealth Fund.

Almost one in five Americans--or 19.1 percent of the nonelderly population--lived in families spending more than 10 percent of before-tax income on health care in 2006, up from one in seven Americans (14.4 percent) in 2001, the study found.

In the study, the author analyzed data from the Medical Expenditure Panel Surveys (MEPS) for 2001 through 2006. Sample sizes of about 28,000 people aged 65 and younger are included for each of the survey years. Overall, the study found that throughout this period the percentage of Americans with high financial burden increased, on average, by about one percentage point per year.

In addition, the study found substantial variation in high financial burden among insured persons across states--ranging from a low of 12.4 percent in California to a high of 26.4 percent in Alabama for the period 2004 to 2006--and that middle- and higher-income people with private insurance experienced the largest increases in financial burden. Since the data in this study predated the current recession, the author postulates that the economic factors of the last two years are likely to have both increased the number of people lacking medical insurance and decreased access to and affordability of private insurance coverage. "To stop and reverse the ongoing increase in the number of families with high health care cost burden," he concluded, "strong economic growth must be accompanied by both increases in family incomes--which have been rare during this decade--and more moderate increases in health care costs." The just-passed health reform legislation, in the author's opinion, "has the potential to reduce the state variation in high financial burden among the uninsured population." This is significant because "states with both high uninsurance rates and high financial burdens among the insured should be a concern for both state and national policy makers, as prior research has shown that high uninsurance rates in an area can have detrimental spillover effects."

About Health Affairs

Health Affairs, published by Project HOPE, is the leading journal of health policy. The peer-reviewed journal appears each month in print, with additional Web First papers published weekly at The full text of each Health Affairs Web First paper is available free of charge to all Web-site visitors for a two-week period following posting, after which it switches to pay-per-view for nonsubscribers. Web First papers are supported in part by a grant from The Commonwealth Fund.