In this episode, we are joined by Mark Hamrick, Washington Bureau Chief for BankRate.com, to discuss their study that delves into the issue of consumers growing increasingly concerned over their health insurance.
Highlights of this episode include:
- The percentage of Men and Women that avoid medical care because of their worries and perception about healthcare costs.
- Why the majority of survey respondents are worried about not having healthcare coverage in the future.
- Interesting finds across generations and gender in regard to perceptions and worries about healthcare coverage.
- Suggestions from BankRate.com to help consumers prepare for health-related events and costs.
- And more…
Mike Passanante: Hi, this is Mike Passanante. And welcome back to the Hospital Finance Podcast.
It’s no secret that health insurance has been in a state of turbulence for some time. As costs continue to rise and policy changes are debated, consumers are growing increasingly concerned over their own health coverage.
Mark is a national award-winning business and financial news journalist who came to Bank Rate after leading business news for broadcast at the Associated Press in Washington for nearly 20 years.
Mark, welcome to the show!
Mark: Great to be with you, Mike. Thanks for having me.
Mike: Thank you for coming on. Why don’t we just start right off. Tell us a little bit about the survey, what you were trying to find out, and who you surveyed.
Mark: Sure! First of all, we hope that everybody is familiar with BankRate.com. But we’re also somewhat humble to realize there’s always another person that can learn about the work we do.
So, we’re a free website. And we provide basic financial information that began with rate surveys that go across the interest rate universe. And we mean to help people connect with their financial goals and provide trusted advice.
In that iteration, we’re always interested, the financial well-being of Americans. And then, we of course pivot to the broader idea of well-being, and we talk about healthcare which I know is near and dear to your world there, Mike.
And of course, as we know, healthcare accounts for a huge portion of the US economy. It takes a big bite out of the budgets of both businesses and individuals—and I guess we should put government in there as well.
And so, according to the federal government, US healthcare spending grew more than 4% in the latest year that they were measuring—which was 2016. And the top $3 trillion, that breaks down to more than $10,000 per person. And as a share of the total output of our nation’s goods and services, better known as GDP, health spending accounted for nearly 18% of that. So that’s somewhere between one-fifth and one-sixth of the total US economy.
And so, we survey people on a regular basis about essentially how they’re doing financially. And so to the extent that healthcare does play such an important role in our economy and our personal finances, we wanted to find out how people are faring with all of this.
So, we partnered with a major polling company called GFK Customer Research. And we, for the purposes of this survey, interviewed people 18 years and older. And the survey was conducted in late July of 2018.
Mike: Great! Thanks for that set-up, Mark. Let’s dive right into the survey results because I think you found some very interesting things.
First, the survey showed that, clearly, people felt insecure about their healthcare and the associated costs. And in fact, it showed that 22% of the respondents said that they or someone in their home went without necessary medical attention because they were concerned with the cost.
But there is more to that story. Could you break that down for us?
Mark: Yeah, absolutely. We’ve got spreadsheets aplenty when it comes to polling that.
Our survey finds, for example, that 25% of women said they, individually, or a family member living in their household had avoided seeking medical care over the previous year even though they needed medical attention. The reason is they feared it would cost too much.
And when we posed that question to men, Mike, the answer as a little lower, 18%.
And when we look at age groups in this data of those people that skipped seeing a doctor when they probably should have, the answer was highest, interestingly enough, among those aged 30 to 49. That was nearly 30% who didn’t seek that visit, so nearly one in three. It falls to 10% for older Americans, those aged 65+. Again, it’s 10% of 65+ who didn’t seek that medical care.
Income. it’s generally those making less money were more likely to avoid care as you might expect. Nearly 28% said they had skipped seeking attention in the group between making $30,000 and $50,000 a year. The number was 19% under $30,000; 18% for those $75,000+.
So, it’s interesting to me that there are plenty of people avoiding care because of this perception of the cost issue.
Mike: It certainly is. And of course, as we know, consumers are shouldering a greater share of the financial burden for their healthcare, maybe direct cost or maybe through their employer plan. Can you talk to us about that?
Mark: Sure! And of course, part of that raises the issue of who has coverage at all. It turns out some 93% of women, 88% of men, have health insurance. So that makes it even more surprising perhaps that women are feeling so much worse about their healthcare situations. Although simply having health insurance doesn’t solve everything, the data suggests.
And so, in terms of the responsibility of paying, 51% of the survey respondents said they’re getting their healthcare by virtue of their employer (obviously, employer-provided coverage). Some 9% are paying for their own. And we break that down among the genders. Between the genders, 11% for men paying for their own; nearly 7% of women.
Pretty steady, by the way, among income levels and age groups when we looked at that question. Nearly a third of the respondents said they’re getting their coverage through Medicare or Medicaid. Eight percent said they didn’t have coverage. Again, looking at gender, 11% of men didn’t have coverage; 6% of women. Blacks and Hispanics are more likely to have no coverage than whites. No coverage, by the way, highest among younger people. Seventeen and a half percent for those aged 18 to 29 had no coverage. And that’s compared to the 4% of those aged 50 to 65 (basically, baby boomers). A 1.4%, quite low, on no coverage for those 65 and older.
Mike: And of course, as we just talked about, people have a worry over their current medical costs or potential medical costs, but they’re also thinking about the potential that maybe they won’t have that health insurance available to them in the future, isn’t that right?
Mark: That’s right, Mike. I think it is interesting how broadly shared these concerns are. Another reason we’re pleased, in retrospect, that we conducted this survey, asking these questions (although maybe there are some other surveys), responses are quite sobering in many instances.
The majority of individuals responding, some 54% were either very worried or somewhat worried that they might not have coverage in the future. So again, the majority of those responding were worried about this.
On the other side of the equation, just to show the balance, if you will, some 45.5% were not worried, meaning they were not too worried or not at all worried. I’m calling them the “What? Me, Worried?” group. They’re more prevalent among the young, meaning 48% of those aged 18 to 29. Obviously, you would presume that the younger individuals would tend to have fewer health problems. And then, seniors, some 62% of those aged 65+ are not worried there.
Mike: Yes, some interesting results there. I suppose the younger immortality idea might fall into that too, huh?
Mark: Exactly. Exactly, exactly.
Mike: Alright… well, I think I used to have that, not so much anymore.
So, let’s talk about the differences as we’re getting into that. Let’s talk about the differences in perception—or worry—about healthcare coverage, across generations and gender. You touched on that a little bit, but let’s dig into that some more.
Mark: Yeah, absolutely. So, 57% of women, 51% of men—and again, that’s obviously the majority—are either very or somewhat worried that they might not have affordable health insurance in the future. And those numbers include 21% of women who say they’re very worried versus 14% of men.
What about age groups on the concern about their coverage in the future? Well, younger baby boomers, and that’s those aged 54 to 63, most are concerned they might not have affordable health insurance in the future. And then, we looked at boomers as well on the question. And they said that 67% were either very or somewhat worried.
Members of generation X—and I always need to be reminded which one is which in terms of age groups on this. Members of generation X aged 38 to 53, mostly concerned. That number is 59%.
So taking a higher, broader view of this, it turns out the majority of Americans across all age categories are worried. That is from 18 to 64. It drops at age 65+ where it falls to 38%, still a sizeable number though (obviously, more than a third). So, I’d say that this is a pretty universal concern among many categories.
Mike: Yeah, it certainly sounds like it. And given the changes that have taken people, I suppose one would think that there would be coverage going into the future with things like the ACA available. But it seems like there are still some uncertainty there which is pretty interesting.
Mark: Well, the other part, Mike, is what faith do you have, for example, in the system? And so if you think about—you know, I’m in my 50’s now. If we think about how the landscape has changed over the course of generations, we’re essentially growing up. Many decades ago, we didn’t even really give much thought to healthcare coverage in the United States. It was a given. You could go to a public hospital if you needed care. And there wasn’t much price to be paid, so to speak, for all that.
But given the changing landscape on healthcare policy in recent years, and what we touched about at the outset, about the rising cost, sort of out-pacing the growth of inflation more broadly, I think that the shifting sands can be as much a source of concern as anything else.
And obviously, when we know that—we’ll try to put this as gently as possible. When we think about the political landscape in Washington being shall we say dynamic, meaning seeming to be rapidly changing over the course of just a decade’s time, you can understand why people don’t have a high degree of confidence that someone will be there to make sure that their backs are covered, so to speak.
Mike: I agree, I agree. Mark, Bank Rate offered a few suggestions along with the survey results to help consumers prepare for health-related events and costs. Can you share those with us?
Mark: Yeah. And as I said at the offset, Mike, this really gets to where it matters I think for our audience, and that is trying to help them. So if you search using good ole’ reliable Google or just go to BankRate.com and search for healthcare savings hints, we have plenty of that content including the story about this poll.
But in terms of specific ideas as well as some broader ones, I wrote an unrelated piece of LinkedIn in recent days where I try to remind people that they always need to be mindful of being a smart consumer. Particularly when they’re immersed in the healthcare settings, it might be one of the clinics now available in drugstores where, basically, we need to get our immunizations (that has sort of been outsourced to the likes of CVS, Walgreens and the likes or urgent care and doctor’s office, of course when we’re undergoing care in more serious settings like a hospital or emergency room. That’s when the dollar signs start really piling up.
So, key questions you should either answer yourself or pose to others. Make sure your providers are in-network, ask about that, or do a search on the website of your provider to make sure they are.
And then, there’s another sort of overriding concern. And this is, at some level, basic. But it’s also obviously one that all too many people forget about. And that is to try to make prevention a priority. And that includes taking care of yourself, paying attention to diet and exercise. Treatment is always more expensive than prevention. Get a flu shot. It’s that time of year as we speak.
Ask how much things cost, is it necessary, who’s paying. When you’re being prescribed medication, how much does that cost? Is there a generic drug available? If you have prescription drug coverage, how much is covered by the insurance? How much is out-of-pocket.
And after you get the treatment—and this can be a big one as well—go line by line over your bill to make sure that everything is as should be, that you actually received the item that’s listed or the care that’s listed.
Make sure that your insurance carrier is paying what it should. If there’s a dispute, appeal it. In fact, Mike, I did that myself once over the past year. And all it took was writing a letter after a phone call. I tried to be patient in that phone call, by the way.
I didn’t prevail in my case because there was a misunderstanding partly on me over what was covered. But I didn’t let it go. And I think that’s the most important point.
Let me just perhaps leave another point here which is a more global one from a financial standpoint. And this is one that we almost can never escape at Bank Rate. And that is that among the chief financial regrets that individuals have in our polling—our surveys have consistently found this out—among the financial regrets that people have, chief among them is the failure to save for retirement, and here’s the really relevant piece, the failure to save for emergencies.
And so, to have an emergency fund is critically important because what kinds of emergencies can qualify. Well, obviously, healthcare emergencies, whether you have a single event or something that’s perhaps unscheduled.
That means dedicating a part of your income to a savings account where that emergency savings comes out, you’re sort of automating it through payroll deductions.
And so, this is a way that we want to try to avoid having those regrets that I talked about because we have found that only 4 in 10 Americans can pay for a $1000 unexpected expense with cash. And the rest basically have to find another means of paying for it. And more than a third do so by taking out more debt.
So, we know that the road to financial ruin can often be associated with healthcare catastrophic expenses, not to mention just some of the ones that are more common. And so, we want to try to help people to think about planning for that.
If they have an option for a healthcare savings account, that’s another good option. Not everybody has access to that. But there are all kinds of tools in the financial toolbox that can help people better mitigate the bumps on the road that have to do with paying for healthcare.
Mike: That was great information, Mark. And of course, we’ll link back to some of these resources on BankRate.com from the show notes of this episode. Mark Hamrick, thank you very much for joining us today on the Hospital Finance podcast.
Mark: It was my pleasure, Mike. Thanks for having me.