To the extent that insurance benefits are well designed, coverage would facilitate and pay for access to essential, effective care when in need and also encourage preventive care and ongoing care for chronic disease to avoid deterioration in health status and still higher health care costs. With information about health, age, work status, and other predictors of health care needs and information about insurance status and type, a measure of medical care economic risk would be able to predict the likelihood that different population groups would incur high out-of-pocket medical expenses, assuming they received care based on their health needs. Conceptually, such a measure would capture the extent to which the uninsured are using far less medical care than expected given their age and health status (underutilization) and also whether insurance policies are leaving low- or middle-income patients and their families at risk of economic costs that would be high relative to their incomes if they became sick—whether or not actual spending occurred (see Meier and Wolfe, in Part III of this volume).
In combination with measures that track medical care economic burden, such a measure of medical care economic risk would add value over time by identifying the source of risk. For example, as stated earlier in the chapter, once fully implemented, the ACA insurance provisions will offer the uninsured and low-income households a choice of plans with different actuarial values (labeled bronze, silver, gold, and platinum). Because these benefit designs may be relatively standardized, it would be possible to include an additional question in such surveys as the CPS ASEC and the Medical Expenditure Panel Survey regarding plan choice level, or at some point in the future merging this information with enrollment files, especially for those who receive premium assistance.9 Using a combination of retrospective data on past spending patterns, it would be possible to project risk in advance of enrollment changes (see Chapter 4 on modeling medical care economic risk and Chapter 5 on potential data sources for development and implementation of a model).
Such modeling is analogous to what actuaries do when estimating next year’s premium rate for a specific population with a specific insurance benefit choice. Such premium projections include patient out-of-pocket costs as well as payments covered by the insurance plan. There are several issues in developing such a prospective measure of medical care economic risk for purposes of assessing the potential that medical care expenses could impoverish a family or lead to forgone care as a result of costs. These include having sufficient information on (1) predictors of health risks (such as jobs, chronic conditions, age and sex, past history of health problems),
9 We note that the Department of Health and Human Services is already taking steps to include on a regular basis or to test some of the information that will be required to measure medical care economic risk; see http://aspe.hhs.gov/hsp/12/surveyenhancements/ib.shtml.