number of thresholds to reflect different levels of medical care need, thereby complicating the poverty measure. Moreover, the predictor variables used to develop the thresholds (e.g., age, self-reported health status) may not properly reflect an individual’s medical care needs during any one year: some people in a generally sicker group may not be sick that year and vice versa for people in a generally healthier group. As a result, it would be very easy to make an erroneous poverty classification.
Another issue is how to account for out-of-pocket medical care costs. Even groups with medical insurance coverage, such as the elderly, pay some of their medical expenses directly, and the dollar amounts for such expenses as health insurance premiums, deductibles, copayments, and payments for uncovered services can be high. Yet little thought had been given prior to the 1995 NRC report as to how to adjust the poverty thresholds or the family resource definition to appropriately account for these costs.
The publication of the 1995 NRC report stimulated extensive research on various elements of the NRC-proposed measure of economic poverty, but it prompted only a few studies on developing a separate measure of medical care economic risk—including those by Doyle (1997); Doyle, Beauregard, and Lamas (1993); Moon (1993); and Short and Banthin (1995). Since that time, hardly any more work has been done, despite increasingly high medical care costs and spending, including increases in insurance premiums and other out-of-pocket expenses, that have put families at increasing financial risk.
Recent preliminary estimates of the financial burden of medical care among the U.S. population based on National Health Interview Survey data collected from January 2011 through June 2011 show that, in the first 6 months of 2011, 20 percent of people—or 1 in 5—were in a family having problems paying medical bills in the past 12 months; 26 percent of people—or 1 in 4—were in a family paying their medical bills over an extended period of time; and almost 11 percent of people—or 1 in 10—were in a family that had medical bills they were unable to pay at all. Overall, 32 percent of people, rising to 41 percent of poor people and 46 percent of near-poor people, were in a family experiencing one or more of these kinds of problems in paying for medical care (Cohen, Gindi, and Kirzinger, 2012).
Renewed interest in a measure of medical care economic risk has come about from the enactment of the Patient Protection and Affordable Care Act of 2010 (ACA), which is designed to significantly extend health insurance coverage in the United States and reduce the financial burden of premiums and other out-of-pocket expenditures for low- and middle-income families. Its passage underlines the potential usefulness of a measure of medical care economic risk that could monitor the effects of various ACA provisions, as well as changes in other medical care programs such as Medicare, on the economic well-being of the U.S. population. The measure would provide