poverty measure.2 That letter discussed the issue of medical care, modifying somewhat what the NRC panel recommended. Specifically, the letter recommended not using the actual out-of-pocket medical expenses for those without insurance coverage, because their lack of insurance protection, combined with low income, might cause them to spend too little on needed medical care.

Following the receipt of this letter, staff at the Census Bureau developed another experimental measure in which medical care was included in the thresholds. A set of medical care risk indexes was developed to adjust those thresholds. And part of those indexes included an adjustment for the uninsured, essentially assigning them the spending of the insured. That measure is still produced at the Census Bureau and referred to as medical out-of-pocket expenses in the threshold.

The Interagency Technical Working Group

The ITWG report also focused on medical care. It noted that self-reported out-of-pocket medical expenses will be collected in the Current Population Survey for the first time in 2010. If this proves to be reasonably reliable for statistical adjustment purposes, then these data should be used as the adjustment for medical out-of-pocket expenses for each family, the report said. The ITWG further emphasized that this approach does nothing to estimate the value of medical care that families are receiving relative to their needs, and additional improved measures of the affordability of medical care and/or the quality of medical care may be useful and important— but these are different statistics and will need to be separately developed and funded.

The ITWG also noted the argument that an adjustment to medical out-of-pocket spending should be made for the uninsured, who may be spending less because they lack health insurance and cannot pay for health services. The ITWG therefore recommended that the Census Bureau inves-

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2 This open letter resulted from a conference held in 1999 on Poverty: Improving the Definition after Thirty Years co-sponsored by the Institute for Research on Poverty, University of Wisconsin–Madison, La Follette Institute of Public Affairs at University of Wisconsin– Madison, and the Brookings Institution, with funding from the Annie E. Casey Foundation. Through a set of meetings, and commissioned papers, a Working Group on Revising the Poverty Measure made agreed upon recommendations for an improved measure. That letter discussed the issue of medical care, modifying somewhat what the NRC panel recommended. Specifically, the letter recommended not using the actual out-of-pocket medical expenses for those without insurance coverage, because their lack of insurance protection, combined with low income, might cause them to spend too little on needed medical care. For further information on the letter, see http://www.census.gov/hhes/povmeas/methodology/nas/files/2August2000OpenLetterPovertyMeasure.pdf.



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