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. 2012 Oct;47(5):2012-30.
doi: 10.1111/j.1475-6773.2012.01397.x. Epub 2012 Mar 14.

Impacts of rising health care costs on families with employment-based private insurance: a national analysis with state fixed effects

Hao Yu  1 , Andrew W Dick
Affiliations

Impacts of rising health care costs on families with employment-based private insurance: a national analysis with state fixed effects

Hao Yu et al. Health Serv Res. 2012 Oct.

Abstract

Background: Given the rapid growth of health care costs, some experts were concerned with erosion of employment-based private insurance (EBPI). This empirical analysis aims to quantify the concern.

Methods: Using the National Health Account, we generated a cost index to represent state-level annual cost growth. We merged it with the 1996-2003 Medical Expenditure Panel Survey. The unit of analysis is the family. We conducted both bivariate and multivariate logistic analyses.

Results: The bivariate analysis found a significant inverse association between the cost index and the proportion of families receiving an offer of EBPI. The multivariate analysis showed that the cost index was significantly negatively associated with the likelihood of receiving an EBPI offer for the entire sample and for families in the first, second, and third quartiles of income distribution. The cost index was also significantly negatively associated with the proportion of families with EBPI for the entire year for each family member (EBPI-EYEM). The multivariate analysis confirmed significance of the relationship for the entire sample, and for families in the second and third quartiles of income distribution. Among the families with EBPI-EYEM, there was a positive relationship between the cost index and this group's likelihood of having out-of-pocket expenditures exceeding 10 percent of family income. The multivariate analysis confirmed significance of the relationship for the entire group and for families in the second and third quartiles of income distribution.

Conclusions: Rising health costs reduce EBPI availability and enrollment, and the financial protection provided by it, especially for middle-class families.

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Figures

Figure 1
Figure 1
(a) An Inverse Association between the Observed Proportion of Families Receiving an Employment-Based Private Insurance (EBPI) Offer and the Medical Cost Index. (b) An Inverse Association between the Observed Proportion of Families with EBPI-EYEM and the Medical Cost Index. (c) A Positive Association between the Observed Financial Risk for Families with EBPI-EYEM and the Medical Cost Index
Figure 2
Figure 2
(a) Observed Trends in the Proposition of Families Receiving an Employment-Based Private Insurance (EBPI) Offer by Quartile of Family Income. (b) Observed Trends in the Proposition of Families Having an EBPI-EYEM by Quartile of Family Income. (c) Observed Trends in the Proposition of Families with EBPI-EYEM and Having OOP Expenditures Exceeding 10 Percent of Family Income by Quartile of Family Income
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