Healthcare costs burden more Americans - study

A growing number of Americans spend more than 10 per cent of their income on out-of-pocket expenses for healthcare services and insurance, according to a study published recently.

The percentage of Americans with a "high financial burden for healthcare" rose to 19 percent in 2006 from 14 per cent in 2001, according to the Washington-based Center for Studying Health System Change.

The think tank defines a high out-of-pocket burden for healthcare as spending more than 10 per cent of before-tax income on insurance premiums and medical care.

"The basic finding was that out-of-pocket costs for health insurance premiums and services were rising faster than family incomes," said Peter Cunningham, who led the study which was published online by the journal Health Affairs.

President Barack Obama signed landmark legislation last week to revamp the $2.5 trillion US healthcare system. It will extend health insurance to 32 million uninsured Americans, expand the Medicaid government health insurance programme for the poor and impose new taxes on the wealthy.

The measure also aims to slow down the rate of healthcare cost increases. The study concludes that the reform is only part of what is needed to help families spending a large portion of their earnings on healthcare.

"We also are going to have to see the kind of economic growth that is going to generate increases in families' incomes because part of the problem that we saw in the last decade wasn't just that healthcare costs were rising, it's that family incomes were largely stagnant," Mr Cunningham said. Mr Cunningham and colleagues analysed data from Department of Health and Human Services surveys from 2001 through 2006. About 28,000 people 65 and younger were included in each of the five years.

The study found the greatest increases in out-of-pocket expenses were for people with private health insurance, including many middle- and higher-income families.

Consumers Union health policy analyst Steven Findlay said the study was another reminder that healthcare is too expensive in the United States and why reform was needed.

"We have to bring down the cost so low- and middle-income people can afford insurance premiums and care and costs that are not covered by insurance," Mr Findlay said.

During this period the United States was spending 14 to 16 per cent of its gross national product on healthcare so it is not surprising that families were spending 10 per cent of their income, said Robert Book, a health economist with the Heritage Foundation, a conservative think tank.

"It's true that we spend a lot on healthcare and it might be true that that's a bad thing if we're not getting value for our money," Mr Book said. "But simply the fact that we're spending a lot on healthcare is not, by itself, a bad thing."