There will be before-and-after comparisons of family spending, in which this measure gets used as a tool for describing winners and losers from the implementation of health care reforms. With that as the driving force, at least in the near term, Short observed that the issue of state variation is really important. The framework for reform leaves a lot to the states, and the numbers that Sara Collins showed emphasized how much variation there is among the states.

In a way, she said, the train has already left the station with the release of the Supplemental Poverty Measure (SPM). It seems to be moving in the direction of looking retrospectively at high out-of-pocket expenses relative to resources, however they are measured and whether or not assets are included with income. In terms of work for the study panel to encourage in the short run, Short thought that there is probably time to bring together the needs standards for other consumption that are in the SPM, to try to give more empirical basis to the idea that people under 200 percent of the poverty line should not spend more than 5 percent of family income on health care. The idea would be to figure out how much room there is for premiums and out-of-pocket expenses, beyond the SPM need standards, rather than arbitrarily picking a threshold of 5 percent of income, 7.5 percent of income, or whatever—numbers that mostly seem to appear out of the air. A measure grounded more in a model of real consumption needs, probably drawn heavily from the SPM, could provide an empirical basis for picking a threshold percentage.

In terms of trying to measure the adequacy of insurance, Short favored the collection and use of information about people’s insurance policies. Gary Claxton’s presentation underscored the importance of detailed information about plans and variation among plans. The distinction between nongroup insurance and employment-based insurance is important and is collected in some surveys.

There also is need for data about employers, as there are important differences in the plans offered by small employers and large employers. At one time, MEPS got copies of people’s policies and abstracted them. There was some discussion during the workshop about actuarial value, which is one way of comparing policies, as are out-of-pocket limits, deductibles, limits in scope and duration, and covered services.

On the issue of assets, Short said she is not sure why the question of counting in assets has been linked to measuring medical care economic risk. Basically, one expects elderly people to use their assets for all kinds of regular consumption.

Sara Collins highlighted a couple of items from the range of issues identified by Short. On the threshold issue, she thought it is probably important to think in terms of income. She did not necessarily agree with Short’s idea about making a stronger empirical basis for picking a percentage. There

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