Using national data on health care spending, co-principal investigator Kathleen Adams, PhD, associate professor at Emory’s Rollins School of Public Health, along with principal investigator Patricia Ketsche of the Institute of Health Administration at Georgia State University and Georgia Health Policy Center, estimated that spending on healthcare consumes more than 20 percent of family income for those in the lowest income group, but no more than 16 percent of income for those in other income groups.
“The percentage of income spent on healthcare would increase as income increases if the system were equitable,” says Adams. “The current pattern exists because private premiums, out-of-pocket spending and state and local spending – which account for more than half of all health care spending – are financed regressively, taking more of lower income families’ incomes.”
In contrast, according to the researchers, federal health spending is financed progressively, which mitigates but does not fully adjust for, inequities in the financing burden across income groups. Under healthcare reform out-of-pocket costs and spending on premiums would be limited to roughly 10 percent of family income for poor and near-poor families and many more families would be insured through Medicaid.
As a result, says Adams and her colleagues, health reform has the potential to increase the equity of the financial burden across families through a variety of initiatives including the Medicaid expansion and subsidized private insurance with income based premium caps.
The Robert W. Woodruff Health Sciences Center of Emory University is an academic health science and service center focused on missions of teaching, research, health care and public service.
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