Americans with job-based health insurance saw their protection from higher out-of-pocket costs erode between 2004 and 2007, especially those who were sick and of modest means, according to a new study.
The majority of people with health insurance, about 160 million Americans, receive it through their jobs.
"American families with employer-based coverage were worse off in 2007 than they were in 2004," said Jon Gabel, the lead author of the study, which was published June 2 on the Web site of medical journal Health Affairs (.pdf file). "This is during a period of time when the economy was expanding."
The authors concluded that a growing number of people are underinsured, a term that refers only to what they pay out of pocket for medical services. Health care affordability, which includes out-of-pocket costs plus employees' premium contributions, also has taken a big hit.
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Comparing expected health spending among different types of health plans, financial protection was greatest for those in health maintenance organizations, or HMOs, the study found. Of five chronic conditions surveyed, patients with breast cancer suffered the highest out-of-pocket costs.
Workers faced an annual average of $729 in medical-services costs in 2007, including deductibles and other forms of cost-sharing, such as co-payments and co-insurance. That was up 34% from 2004, when the average out-of-pocket burden for those with employer coverage was $545.
Job-based health plans picked up 80% of total costs in 2007, covering a slightly smaller percentage of overall expenses than they did in 2004. More workers confronted plans with deductibles, and deductible levels were set higher, according to the study. But the main reason for rising out-of-pocket costs was the growth in overall health spending.
20% co-pay seems low, unless you have cancer
The report showed a widening gap between adults who need to tap their health insurance to cover medical visits and those fortunate enough not to have much need of their benefits. Adults with chronic medical conditions drove higher spending for both themselves and their health plans.At the two extremes, the average out-of-pocket expense for the 50% of workers with the lowest health spending grew 23% to $85 in 2007. But expenses jumped 42% to $8,703 among the highest-spending 1% of workers, the study found. For the highest spending 10% of workers, the average out-of-pocket costs amounted to $3,364, an increase of 39% from 2004.
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For some patients, co-insurance may seem like a small sum -- set at 10% or 20%, for example, when services are from an in-network health provider -- but costs can add up quickly as absolute dollar figures rise. The study found that insurance paid for 84% of the bill for five selected chronic conditions: asthma, breast cancer, diabetes, chronic obstructive pulmonary disease and hypertension.
Continued: Sticker shock for breast-cancer patients
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