High out-of-pocket costs can make health care unaffordable. Underinsured delay, forgo needed care.
Ann Arbor, MI (September 1, 2015)
The Center for Healthcare Research & Transformation at the University of Michigan today released a special report: The Underinsured in Michigan. The issue brief shows that in 2013, nearly 1.2 million Michigan residents with health insurance coverage had out-of-pocket medical spending that was high enough relative to income to be considered underinsured. These underinsured individuals exceeded the 1 million who were uninsured in Michigan in the same time period.
“Many of these are individuals struggling to pay medical expenses, often not seeking care or denying themselves needed treatments and prescriptions because they cannot afford their co-pays and/or deductibles,” said Marianne Udow-Phillips, director of the Center for Healthcare Research and Transformation. “Having health insurance coverage alone does not guarantee access to care.”
Insured individuals struggling to pay their share of medical expenses also pose a significant challenge for health care providers who, through 2013, faced increasing bad debt from uncollected patient bills.
In the report, an individual is defined as underinsured if their out-of-pocket obligations for health care expenses exceeded 10 percent of income in families that earned more than 200 percent of the federal poverty level (FPL), or exceeded 5 percent of income in families earning less than 200 percent of FPL.
Highlights of the report include:
- In 2013, close to 40 percent of those who directly purchased insurance for themselves in Michigan were considered underinsured, the highest percentage of those with any type of insurance.
- From 2012 to 2013, out-of-pocket health spending increased 5.8 percent. Yet, average worker wages increased by just 1.9 percent.
- Workers in the leisure, hospitality and service industries were the least likely to be adequately insured (63.9 percent).
A CHRT survey of Michigan consumers found that more than one-fifth of those with insurance reported that they had delayed needed care, with the cost of that care cited most frequently as the reason for the delay. Nationally, a recent survey by The Commonwealth Fund showed that roughly 44 percent of underinsured adults did not get needed health care because of cost in 2013.
“This report focuses on 2013, the year before the ACA’s major coverage expansions took effect. As more individuals get coverage and the numbers of those that are uninsured decline, the issue of underinsurance is likely to have a more significant focus for providers and policy makers,” said Udow-Phillips. “The trends noted in this report will be important to monitor on an ongoing basis over time.”
This brief is a part of the Cover Michigan 2015 series. Read this report and other installments in the series at www.chrt.org.
The Center for Healthcare Research & Transformation (CHRT) illuminates best practices and opportunities for improving health policy and practice. Based at the University of Michigan, CHRT is a non-profit partnership between U-M and Blue Cross Blue Shield of Michigan designed to promote evidence-based care delivery, improve population health, and expand access to care.