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Board of Governors of the Federal Reserve System
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Report on the Economic Well-Being of U.S. Households in 2013

Health Insurance Coverage and Health-Care Expenses

To better understand the role that health-care costs and health security play in the financial experiences of households, the survey asked several questions about health insurance and expenditures.

Health Insurance Coverage

According to the survey, 84 percent of respondents were covered by some type of health insurance or health coverage plan when the survey was conducted. The question used to assess insurance coverage in the SHED is identical to the one found in the Census Bureau's American Community Survey (ACS). The SHED finds that approximately 80 percent of people ages 18 to 64, and more than 99 percent of people over age 65, reported some form of health insurance at the time of the survey in September of 2013. (For comparison, estimates of insurance coverage rates for the same groups based on the 2012 ACS data were 79 percent and 99 percent, respectively.) 12

Health insurance coverage is positively correlated with both income and age. Approximately 76 percent of respondents under the age of 29 had insurance, compared with 79 percent of those ages 30 to 44 and 84 percent of those ages 45 to 64 (table 21). Similarly, among individuals under the age of 65, approximately 69 percent of those who earn less than $25,000 a year had some insurance, compared with 88 percent of those making between $50,000 and $75,000 per year and 96 percent of those making $100,000 or more (table 22).

Table 21. Health insurance coverage (by age)
Percent, except as noted
Age categories Insured Uninsured
18-29 75.8 24.2
30-44 79.4 20.6
45-64 84.0 16.0
65+ 99.6 0.4
Overall 83.8 16.2
Total number of respondents 4,134
Table 22. Health insurance coverage (by income among those under age 65)
Percent, except as noted
Income categories Insured Uninsured
Less than $25,000 69.2 30.8
$25,000-$49,999 76.2 23.8
$50,000-$74,999 87.7 12.3
$75,000-$99,999 94.6 5.4
$100,000 and greater 95.8 4.2
Overall 81.5 18.6
Total number of respondents 3,102

Note: Among those who reported their income.

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Coping with Health-Care Costs

Despite the high rate of insurance coverage, out-of-pocket costs were a concern for many respondents. When asked if they could afford to cover the cost of a major out-of-pocket medical expense, 43 percent of all respondents said that it was not likely that they could afford to pay, while 34 percent indicated that it was somewhat likely that they could afford to pay. Only 21 percent of respondents indicated that it was very likely they could afford to pay for a major out-of-pocket medical expense. In fact, almost a quarter of respondents experienced what they described as a major unexpected medical expense that they had to pay out of pocket in the prior 12 months.

This inability to pay factored into individual health-care decisions, as many respondents reported that they went without some type of care because they were unable to afford it. One quarter of respondents went without dental care in the prior 12 months because they could not afford it, 18 percent went without a doctor visit, 15 percent went without prescription medicine, 11 percent went without a visit to a specialist, and 10 percent went without follow-up care. Overall, 34 percent of respondents reported going without at least one of these types of care because they could not afford it. Not surprisingly, the frequency of foregoing some type of health care was higher among individuals without health insurance. Among those respondents who were uninsured, 53 percent reported that they had gone without some form of medical treatment in the preceding 12 months. In comparison, 30 percent of respondents who had health insurance reported going without some form of medical treatment in the same period.

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Health-Care Costs and Financial Well-Being

Recognizing that health insurance is just one component of payments for medical care, the survey also allows for a look at the link between medical care and personal savings. Of the people who avoided medical treatment because of the cost, only 16 percent reported having an emergency fund or rainy day fund capable of covering three months of expenses. For people who did not avoid any medical treatment, approximately 52 percent had a rainy day fund. Similarly, 34 percent of people who avoided treatment because of the cost also reported that they regularly save part of their income, compared with 60 percent of the respondents who did not avoid medical treatment.

The survey also indicates that there is a relationship between health-care decisions and some forms of consumer credit. For instance, 44 percent of individuals with student loans reported avoiding medical treatment because they could not afford it, compared with 30 percent of people without student loans. Of people with credit cards, 40 percent of those who said they did not pay their full balance each month also had avoided medical treatment; this compares with 19 percent of people who paid their entire credit card balance and also avoided treatment.13

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12. U.S. Census Bureau (2013), "Health Insurance Coverage Status," to text

13. These factors are statistically significant predictors of the respondent reporting that he or she had avoided some form of medical treatment due to cost, even after accounting for income and age in a probit regression. Return to text

Last update: August 15, 2014

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