2005 Health Confidence Survey: Cost and Quality Not Linked
By Ruth Helman, Mathew Greenwald & Associates, and Paul Fronstin, EBRI
Employment Benefit Research Institute
EBRI Notes
November 2005
Increasing health care costs continue to be strongly related to dissatisfaction with the health care system, and those who have experienced increased costs within the past year are more likely than those who have not to be dissatisfied their current health plan and other aspects of the health care.
A majority of Americans with health coverage have experienced health care cost increases in the past year. Those with employment-based coverage and those who report their health status has gotten worse over the past five years are more likely to report these cost increases.
Those who have experienced cost increases have compensated by making changes in the way they use health care. (54 percent) say they now go to the doctor only for more serious conditions or symptoms. (40 percent) have delayed going to the doctor. (21 percent) report cost increases have caused them to not take their prescribed medication. Lower-income Americans and those in poorer health are more likely to report making each of these changes.
Increased health care costs have also affected household finances, and many of those who have experienced cost increases have coped by reducing the amount they save or by depleting their savings. One-quarter report they have decreased their contributions to a retirement plan as a result of the increased cost of health care (26 percent), and almost half report they have decreased their contributions to other savings as a result of the increases (45 percent). One-quarter say they have had difficulty paying for basic necessities, like food, heat, and housing (24 percent), while one-third report difficulty paying other bills (34 percent). Three in 10 indicate they have used up all or most of their savings (29 percent), and 18 percent have borrowed money.
Despite the increasing amount of cost sharing that employers are asking of their workers, most Americans appear to value employment-based health coverage above the actual dollar amount that employers pay toward the care. When employed Americans with health coverage are asked whether they would prefer $6,700 in employment-based health insurance coverage or an additional $6,700 in taxable income, 8 in 10 choose the employment-based health coverage (80 percent). Two-thirds would prefer employment-based coverage to an increase in income even if an employer paid $10,000 toward the coverage(66 percent). Furthermore, this preference for employment-based coverage emerges regardless of demographic characteristics.
http://www.ebri.org/pdf/EBRI_Notes_11-2005.pdf
Comment: (Not addressed in the excerpts nor in these comments is the finding that Americans still have relative confidence in the quality of our health care system.)
The selected excerpts above confirm what we already knew. Americans are very concerned about increasing health care costs, and affordability is having a very significant negative impact on access and on their personal finances.
An important conclusion of this report is that Americans strongly support employment-based health coverage, and would relinquish comparable income increases in order to maintain employer-sponsored coverage. Advocates of reform based on employer-sponsored plans will surely jump on this study as an affirmation of the validity of their model of reform. But is that conclusion really warranted?
Individuals are very concerned about the risk of unanticipated health care costs. Right now, they have up to three options: coverage through their employment, individual coverage, or no coverage at all. Responsible individuals would never accept doing without coverage as being an acceptable option. The greater value and comprehensiveness of employer-sponsored coverage makes it a preferred option to individual coverage. So it is quite logical that most individuals would support plans offered through their employment.
But what if they were offered another option? What if they were told that they could always have coverage regardless of what might happen to their employment? What if they were told that they would need to relinquish only an equitable portion of their income, through a payroll tax, rather than relinquishing an arbitrary amount such as the $10,000 in this survey? What if they were told that comprehensive benefits would always be provided since other more efficient mechanisms, rather than benefit reductions, would be used to maintain affordability?
Today, even General Motors employees might be interested in hearing about such an option. Even the New York Times, in an editorial yesterday, broke new ground by stating “…shame should also be aimed at Washington lawmakers who have done nothing to solve the larger problem, the crying need for national health insurance.”
New York Times editorial:
http://www.nytimes.com/2005/10/17/opinion/17mon3.html