Recommendation 5-1: The panel recommends that the development of a model for estimating a prospective measure of medical care economic risk be carried out with the Medical Expenditure Panel Survey (MEPS) longitudinal file. The panel also recommends that the Health and Retirement Study (HRS) be used to validate the results of the MEPS modeling for at least the elderly, if not the entire population over age 50, which the HRS sample represents.
For production, the choice is less clear. The MEPS full-year consolidated file and the CPS ASEC have different strengths and different limitations with respect to required data elements, making them difficult to compare. On other points of comparison, the CPS ASEC is more timely than MEPS, has five times the sample size, and serves as the source of the complementary SPM. On balance, these considerations favor the CPS ASEC if it can be shown that a predictive model of MCER can be transported successfully from MEPS to the CPS ASEC. If MCER depends too heavily on the measures of chronic medical conditions and functional limitations that are present in the MEPS but not the CPS ASEC, then the CPS ASEC would not be a satisfactory choice.
If the development effort should demonstrate that a prospective measure is itself not viable at present or not sufficiently different from a retrospective measure, then the CPS ASEC would be a stronger choice for this alternative measure. In this case, however, there may be value in using MEPS to create a supplemental measure, in which MCER could be associated with the chronic conditions and functional limitations that MEPS measures but the CPS ASEC does not.
A principal limitation of using either MEPS or the CPS ASEC for either a prospective or retrospective measure of MCER is the lack of information on insurance coverage beyond the general categories of employer-sponsored, Medicare, Medicaid, individually purchased, or other sources. After 2014 when the major insurance reforms of the Patient Protection and Affordable Care Act (ACA) take place, the Census Bureau or AHRQ could consider adding a question about the level of coverage in terms of bronze, silver, or gold levels of actuarial value. This information could serve as a proxy for plan type and cost-sharing for insured families in the lower income ranges. Individuals and families may also become more aware of out-of-pocket costs for premiums because ACA requires that this information be included in tax filing. For the CPS ASEC, the value of its health insurance data for measuring MCER could be enhanced by capturing coverage at the time of the interview in addition to or instead of the prior calendar year. Other items to consider adding to the CPS ASEC include functional limitations, chronic medical conditions, and liquid assets. Items to consider adding to MEPS include additional in-kind benefits, federal and state income taxes,