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Financial Burden Of Health Care, 2001–2004

Jessica S. Banthin, Peter Cunningham and Didem M. Bernard

Analysis of data from the Medical Expenditure Panel Survey (MEPS) shows that rising out-of-pocket expenses and stagnant incomes increased health spending’s financial burden for families in 2001–2004, especially for the privately insured. High financial burdens among those with nongroup coverage increased by more than one-third. Despite evidence of increased cost sharing in private insurance plans, our analysis does not show that privately insured people paid a higher share of their total health care bill in 2004 compared to 2001. Financial burdens have increased to the point at which private insurance is no longer able to provide financial protection for an increasing number of families.

Health Affairs, 27, no. 1 (2008): 188-195
doi: 10.1377/hlthaff.27.1.188
© 2008 by Project HOPE

The U.S. Economy And Changes In Health Insurance Coverage, 2000–2006

John Holahan and Allison Cook

The number of uninsured Americans increased by 3.4 million between 2004 and 2006, despite improving economic conditions. In the first four years of the decade, during a period of economic recession, the number increased by 6.0 million. The dominant factor in both periods was a decline in employer-sponsored insurance coverage. Although the recent decline was less than that experienced from 2000 to 2004, growth in public coverage was small, and the number of uninsured people increased by 1.0 million children and 2.4 million adults. Employer coverage declined most for self-employed or small-firm workers, in the South, and among noncitizens.

Health Affairs, 27, no. 2 (2008): w135-w144
doi: 10.1377/hlthaff.27.2.w135
© 2008 by Project HOPE

A Business Week article:

During the last recession, earlier this decade, unemployment rose from 4.2% to 5.6% and more than 1 million Americans lost their health-insurance coverage, according to an analysis by Cornell University economists. By August, 2003, when the economy was recovering, only an estimated 137,000 people had regained health coverage. This time around, a recession could result in 4.2 million people losing health coverage, predicts the Center for Economic & Policy Research, a Washington think tank.

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HCA, Nashville, said it expects to see bad-debt expense continue to rise at 18% to 20% per year unless federal policymakers expand coverage of uninsured patients. The company said its bad-debt expense for the fourth quarter of 2007 was 13.2% of revenue, or 21% higher than the 10.9% figure the company reported for the fourth quarter of 2006. Three factors combined to fuel the increase, said Milton Johnson, executive vice president and chief financial officer of HCA: lower collection rates on patient accounts; growth in uninsured patients; and the annual increases in HCA’s gross charges, or list prices. For 2007, HCA’s bad-debt expense was 11.7% of revenue, up from 10.4% in 2006.

The company’s profits for the fourth quarter were $278 million, more than double the profits of $122 million in 2006’s fourth quarter. The fourth quarter of 2006, however, included $433 million in transaction costs related to the company’s $33 billion leveraged buyout. Revenue for the quarter increased 6.1% to $6.88 billion. For the year, profits declined by 15.9% to $874 million from $1.04 billion in 2006. Revenue increased 5.4% to $26.86 billion.

HCA received $611 million for the sales of three hospitals in 2007, and used the proceeds to pay down debt, according to the company. Jack Bovender Jr., HCA’s chairman and chief executive officer, said it would not be surprising if HCA made more facility sales in 2008. As of Dec. 31, 2007, HCA owns or operates 169 hospitals and 108 freestanding surgery centers. -- by Vince Galloro

Cost of Uncompensated Care on the Rise, Says Hospital Association

The cost of uncompensated hospital care in the United States totaled $31.2 billion in 2006, up from $28.8 billion in 2005 and $21.6 billion in 2000, according to the latest data from the American Hospital Association’s (AHA) Annual Survey of Hospitals. Underpayment by Medicare and Medicaid reached nearly $30 billion in 2006, up from $25.3 billion in 2005 and $4 billion in 2000. Medicare reimbursed 91 cents and Medicaid reimbursed 86 cents for every dollar hospitals spent caring for these patients. AHA president and CEO Rich Umbdenstock said the data “show what we’ve been hearing from the field--that hospitals are seeing more and more patients while future financing is uncertain, emergency departments continue to be overcrowded, and fewer workers are available to provide care

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