New Study Finds Poor Medicaid Beneficiaries Face Growing Out-Of-Pocket Medical Costs
Center on Budget and Policy Priorities
May 31, 2005
A new Center report finds that out-of-pocket medical expenses for poor adult Medicaid beneficiaries have grown twice as fast as their incomes in recent years. These individuals spend more than three times as much of their income on health care as middle-class adults with private insurance, the study finds.
Increasing cost-sharing, such as through higher copayments or premiums or the elimination of certain benefits (such as dental or vision coverage), has been suggested as a way to reduce Medicaid costs and promote “personal responsibility.” As a second new Center report shows, however, a substantial body of research finds that increased copayments cause low-income beneficiaries to cut back on essential care, and higher premiums lead to fewer people being covered by health insurance.
The risks of increased cost-sharing are greatest for those with serious or chronic health conditions, such as diabetes, cancer, or mental illness, since they need the most health care services and thus would face more copayment charges or the loss of more services. Moreover, the consequences of going without a needed service can be especially severe for individuals who are in poor health.
News Release:
http://www.cbpp.org/5-31-05health-pr.pdf
Report: “Out-Of-Pocket Medical Expenses for Medicaid Beneficiaries Are Substantial and Growing” By Leighton Ku and Matthew Broaddus http://www.cbpp.org/5-31-05health.pdf
Report: “The Effect of Increased Cost-Sharing in Medicaid: A Summary of Research Findings” By Leighton Ku http://www.cbpp.org/5-31-05health2.pdf
Comment: Shifting health care costs to individuals who need health care is a seriously flawed policy in that it impairs access and outcomes. A universal, public insurance system can contain costs without the necessity of imposing financial barriers to needed care. But until we have a universal system, it is crucial that we protect access for the most vulnerable patients by reversing this trend of shifting more costs to Medicaid patients in need.