27% of Adults Face At Least One Healthcare Affordability Challenge

Healthcare affordability is significantly impacting low- and middle-income families, but healthcare financial strain is becoming a more widespread issue for US families, a new study published in Health Affairs indicates.

About 27 percent of non-senior adults lived in families with at least some severe healthcare affordability issues, such as high out-of-pocket cost burden, medical debt, or forgone medical care, researchers from the Agency for Healthcare Research and Quality (AHRQ) reported in the study. And that percentage jumped to almost 46 percent of US adults when researchers used more broadly defined healthcare financial strains, including delayed care.

Researchers said this study of multiple healthcare affordability issues paints a more complete picture of healthcare financial pressures in the US.

The study analyzed data from the Medical Expenditure Panel Survey (MEPS), a nationally representative survey of the US civilian non-institutionalized population conducted annually by AHRQ. Researchers pooled data from 2018 and 2019 for people between 19 and 64 years living in families without people 65 years or older. The study excluded families with seniors because of their unique needs, coverage and income, and financial strains.

Researchers believe this is the first study to use MEPS barriers data and one of the few analyses to leverage the survey’s medical debt data to identify how multiple healthcare affordability issues impact US families.

Healthcare affordability challenges particularly impacted low-income families. The share of adults living in poverty facing at least one financial problem was almost 43 percent using the stricter definition of burden, medical debt, and care barriers, and about 53 percent using a broader definition that only accounted for delayed (not forgone) care and relaxed requirements for medical bills to be deemed problematic.

In contrast, families with incomes more than four times the federal poverty level had less than half the frequency of healthcare affordability challenges in a narrow sense.

In general, healthcare affordability was an issue for lower-income families. For example, high burdens declined steadily as income levels increased, from about 18 percent at the lowest income level to almost 3 percent at the highest. Medical debt was less strongly associated with poverty level, although it was more common among poor (11 percent), low-income (11.5 percent), and middle-income (11.8 percent) of families. Financial barriers to care were also more common among these groups (28 percent, 28 percent, and 22 percent, respectively).

The study also found that adults covered by employer-sponsored insurance had substantially fewer healthcare financial problems than those with private, non-group, Medicaid, and other public coverage, as well as those with no coverage.

Meanwhile, adults in families with diabetes or limitations, such as needing help with activities of daily living, had higher frequencies of healthcare affordability issues (38 percent and 45 percent, respectively, using the narrow definition). However, having a cancer patient in the family was not associated with increased burden frequency.

“These families had substantial medical care needs yet often found themselves having to choose among paying large out-of-pocket amounts, accumulating medical debt, or delaying or going without care they thought they needed because of cost,” researchers wrote in the study.

Researchers acknowledged limitations, including different, but overlapping periods of study, and the lack of data on employer premium contributions, which could reflect a greater burden on families with employer-sponsored coverage if they at least partially contribute to premiums.

But overall, they said this picture of healthcare affordability has significant policy implications. The findings, for instance, highlight the importance of the Inflation Reduction Act of 2022 in extending pandemic-era Marketplace premium and cost-sharing reductions through 2025, considering the high rates of financial strain among adults with private, non-group coverage.

Additionally, the findings underscore the importance of Medicaid continuous enrollment to low-income populations who would otherwise have no coverage or costly private coverage.

However, researchers said that their study, more importantly, provides a more complete understanding of healthcare affordability that is not specific to any one policy measure aimed at addressing medical debt and other healthcare financial strains.

“[Our findings] can help provide context for the urgency felt across the country for change that addresses all dimensions of healthcare financial strain,” researchers concluded.