Individuals in the lowest income bracket are paying more than twice as much to finance the cost of their healthcare than those who make the most money, according to a report released today by the RAND Corporation.
The report looked at a number of different data points to determine the burden of healthcare costs on individuals in different income brackets. The problem is especially acute for individuals in the lowest income bracket who need long-term care because in order to qualify, they must deplete most of their savings.
“Our findings suggest that health care payments in the United States are even more regressive than suggested by earlier research,” said Katherine G. Carman, lead author of the study and a senior economist at RAND, a nonprofit research organization, in a statement. “As national discussions continue about health reform and health equity, it’s important to understand how the current health care system distributes costs and payments.”
Individuals in the lowest 20% income bracket spend nearly 34% of their income on healthcare costs, according to the research, compared with 16% for individuals in the highest income bracket. The middle three tiers analyzed by the researchers spent between 20% and 23% of their income on healthcare costs.
Health insurance premiums accounted for just 9% of the average healthcare costs for individuals, according to the research. Payments to finance healthcare costs totaled $9,393 per person, or 18.7% of the average household income.
Individuals who qualify for Medicare have the largest dollar value of healthcare received as a percentage of their income, giving them the best value for the money they spend, according to the report. Those with employer-sponsored insurance received the lowest dollar value of coverage.
