Out-of-pocket expenses drag 11 million people into poverty

The Supplemental Poverty Measure: 2015

By Trudi Renwick and Liana Fox
United Census Bureau, September 2016

This is the sixth report describing the Supplemental Poverty Measure (SPM) released by the U.S. Census Bureau, with support from the Bureau of Labor Statistics (BLS). The SPM extends the official poverty measure by taking account of many of the government programs designed to assist low-income families and individuals that are not included in the current official poverty measure.

In 2015, 45.7 million people were poor using the SPM definition of poverty, more than the 43.5 million using the official definition of poverty with the adjusted universe.

The SPM and the Effect of Cash and Noncash Transfers, Taxes, and Other Nondiscretionary Expenses

(Excerpt): Without subtracting MOOP (Medical Out-of-Pocket) expenses from income, the SPM rate would have been 3.5 percentage points lower. In numbers, 11.2 million fewer people would have been classified as poor.


Uninsured rate drops, but medical expenses still drag millions into poverty

By Bob Herman
Modern Healthcare, September 13, 2016

However, separate census data showed that medical out-of-pocket expenses dragged 11.2 million people into poverty in 2015, a potential symptom of the shift of moving employees and individuals into health plans that have higher deductibles, copays and coinsurance rates.



By Don McCanne, M.D.

We read repeatedly about how out-of-pocket health care spending is exposing patients to financial hardship. Yet our policymakers are continuing to expand that exposure under the screwball concept that spending out of pocket makes patients better health care shoppers, which we know is not true. It only makes them forgo beneficial care. Today’s number should be an awakening call: in 2015, out-of-pocket health care expenses shoved 11 million individuals into poverty!

At a time when we need to improve our anti-poverty programs, we are pushing more people into poverty through policies inherent in our dysfunctional health care financing system. With a well-designed single payer system, nobody would be forced into poverty because of medical bills.

Or should we continue with policies that prevent people from getting the care they should have, while forcing millions into poverty? How could anyone think that we really have a choice here?