What’s at Stake
Life expectancy of the uninsured
The high cost to society of providing healthcare is a common complaint, but there are high costs to not providing healthcare. Many studies have linked a lack of insurance to higher mortality rates and poorer health:
- A 2009 study in the American Journal of Public Health found that nationwide, 45,000 annual deaths were associated with a lack of health insurance. It found that uninsured, working-age Americans had a 40% higher risk of death than their privately insured counterparts.
- A 2017 meta-analysis of the literature published in the Annals of Internal Medicine found that being uninsured raised the risk of dying by more than 25%.
- A 2012 New England Journal of Medicine study that compared Medicaid expansion in three states compared with neighboring states found “a significant reduction in all-cause mortality” of 6.1% in the Medicaid-expansion states.
- Black women are more likely than White women to die from breast cancer. An American Cancer Society study found that differences in health insurance coverage—many more White women have insurance than Black women—explained about 35% of the excess risk of death in Black women.
Americans’ personal financial health
Patients’ financial as well as physical wellbeing is at stake. “More than 13% of American adults—or about 34 million people—report knowing of at least one friend or family member in the past five years who died after not receiving needed medical treatment because they were unable to pay for it”, according to a study by Gallup and West Health.
The uninsured are particularly vulnerable. A 2016 survey by the Kaiser Family Foundation and the New York Times found that 53% of uninsured people reported problems paying household medical bills in the past year.
But roughly one in five people with insurance reported problems paying medical bills, as well.
Difficulty in paying medical bills can lead to bankruptcy. A survey of Americans who had declared bankruptcy found that 37% of them “very much agreed” that medical expenses contributed to their bankruptcy.
Some medical conditions can be so expensive that moderate-income patients are also vulnerable to the high costs of healthcare. A 2018 study in the American Journal of Medicine found that among the 9.5 million patients who were over 50 years old and diagnosed with cancer from 2000 to 2012, 42% had depleted all their assets after two years.
The nation’s financial health
In an assessment of the nation’s post-pandemic fiscal health, the Governmental Accounting Office (GAO) first notes that “the federal government’s long-term fiscal path was unsustainable because debt was growing faster than the economy.” The GAO projects that the national debt will reach a historic high in 2028 and continue to grow faster than the economy.
According to both the GAO and the Congressional Budget Office (CBO), healthcare spending is the leading driver of long-term federal government spending. In its 2021 Long-Term Budget Outlook, the CBO projects government spending to average almost 30% of GDP between 2042-2051 – a 9% increase from the last decade, 2010-2019.
The primary contributor to the increase in healthcare spending is the continued rise in the cost of care, while our aging population is also a factor as it becomes an increasingly larger segment of the population.
The Committee for a Responsible Federal Budget wrote in 2018 that healthcare would consume a larger share of the federal budget over time. “In 1970, major health programs made up only 5% of the budget. That share increased to 20% by 2000 and 28% by 2017. By 2028, one-third of federal dollars not spent on interest will go toward health spending, and by 2040, nearly 40% will.”