Health Care Costs Affecting Other Savings

October 7, 2008 (PLANSPONSOR.com) - Insured Americans continue to experience health coverage cost increases and they report that these increases have negatively affected their household finances.

According to the 2008 Health Confidence Survey (HCS) sponsored by the Employee Benefit Research Institute (EBRI) and Mathew Greenwald & Associates, roughly half of Americans with health insurance coverage report having experienced an increase in health care costs in the past year (55%, down from 63% in 2007). Those experiencing cost increases indicate that increased health care costs have resulted in a decrease in contributions to retirement (29%) and other (54%) savings, and in difficulty paying for basic necessities (27%) and other bills (34%), according to an EBRI news release.

In addition, health cost increases affect health care spending habits. Those who have experienced an increase in health care costs in the past year are more likely than those who have not to say they now choose generic drugs more often (74% vs. 60%), talk to the doctor more carefully about treatment options and costs (63% vs. 52%), and go to the doctor only for more serious conditions or symptoms (62% vs. 48%).

Despite concerns about costs, confidence about various aspects of today’s health care system has remained fairly level with findings from the 2007 HCS, EBRI said. Fifty-one percent of respondents report being extremely or very confident that they are able to get the treatments they need, and 42% are confident they have enough choice about who provides their medical care. Thirty-one percent say they are confident they are able to afford health care without financial hardship; however, 42% are not too or not at all confident about the affordability of health care — an increase from 36% in 2007.

The 2008 HCS found 20% of Americans say there is so much wrong with our health care system that it needs to be completely overhauled. Fifty-one percent agree that "there are some good things about our health care system, but major changes are needed."

A majority rate the nation's health care system as fair (29%) or poor (31%), while only a small minority give it excellent (4%) or very good (11%) marks. While half of Americans (49%) say they are extremely or very satisfied with health care quality, far fewer are satisfied with the cost of health insurance (17%) or with costs not covered by insurance (15%).

Virtually all Americans say that extremely or very important goals when reforming our nation's health care system should be to provide high quality health care (93%) and to make health care more affordable (90%). Americans generally feel that centrally maintained electronic medical records that can be shared by authorized health care providers are important (60% say this is extremely or very important); however, 62% indicate they are not too or not at all confident that such records would remain confidential.

According to EBRI, strong support exists for tax incentives to help expand health insurance coverage, with 87% of HCS respondents saying they would support tax incentives to help people pay for coverage they purchase on their own, and 84% saying they would support tax incentives to help people pay for employer coverage. Substantial majorities also report they would support allowing the uninsured to buy into Medicare or Medicaid (78%) or to buy health insurance coverage offered to government employees (83%).

The 2008 Health Confidence Survey was conducted from May 24 to June 30, 2008, through random telephone interviews with 1,000 individuals ages 21 and older in the United States. Full results appear in the October 2008 EBRI Notes, available at www.ebri.org .

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