Financial Burden Of Health Care, 2001-2004

[RedEarth]

The same affordability issues that low-income families experienced a decade ago have begun to affect middle-income families today

By Jessica S. Banthin, Peter Cunningham and Didem M. Bernard
Health Affairs
January/February 2008

In the first part of this decade, health care costs continued to increase at rates far above general inflation, and employers increasingly shifted these higher costs to workers in the form of higher out-of-pocket payments for premiums, deductibles, and copayments. Adding to the pressure on families was slower economic growth during 2001-2004, which resulted in increases in poverty rates and the number of uninsured people.

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Financial burden of health care

The financial burden of health care increased for American families during the first part of this decade as a result of rising out-of-pocket spending for health care and stagnant family incomes. Between 2001 and 2004, the percentage of the nonelderly population living in families with high out-of-pocket health care burdens rose from 15.9 percent to 17.7 percent. By 2004, 45.4 million people lived in families with high burdens—an increase of almost six million from 2001.

Increases in out-of-pocket spending between 2001 and 2004 were driven by both increases in health insurance premium payments and spending on health care services. Even after general inflation is accounted for, total out-of-pocket spending on health care rose by $373 to $2,656 in 2004, an increase of about 16 percent over the three-year period. In contrast, average family incomes not only failed to keep pace with rising out-of-pocket spending during this period but were largely unchanged after general inflation was accounted for.

http://www.pnhp.org/news/2008/january/high_burden_hits_mid.php