U.S. Residents Cut Back On Health Care Spending As Economy Worsens

Main Category: Health Insurance / Medical Insurance
Also Included In: Public Health
Article Date: 23 Sep 2008 - 5:00 PDT

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U.S. spending on health care services is "under pressure" as Americans are "cutting back on health care," an area of the economy "once thought to be invulnerable to recession," the Wall Street Journal reports. According to IMS Health, the number of prescriptions filled decreased by 0.5% from a year earlier in the first quarter and by 1.97% from a year earlier in the second quarter. Walgreen CEO Jeffrey Rein earlier this month at an investor conference said that the pharmacy industry this year has experienced the "tightest prescription market" in his 27-year career.

In addition, the number of physician visits has continued to decrease since the end of 2006. Physician visits deceased by 1.2% from July 2007 to July 2008, according to IMS Health. A survey of 686 consumers released last month by the National Association of Insurance Commissioners found that 22% of respondents avoided physician visits because of cost concerns.

An analysis of health insurance claims from 250,000 employees enrolled in several dozen employer-sponsored health plans in the mid-Atlantic area found that those workers have sought fewer health care services. The analysis, recently conducted for the Journal by D2 Hawkeye, found that those employees sought fewer preventive or nonacute health care services, despite minimal changes to their benefits or cost-sharing requirements.

Health care policy experts said that "patients' short-term care cutbacks could lead to more medical problems and higher spending down the road" and that admissions to hospitals and emergency departments "could eventually spike" as more patients "forgo screenings or wait until minor medical problems blow up into serious complications," according to the Journal (Fuhrmans, Wall Street Journal, 9/22).

Effect of Budget Deficit
The Washington Times in an article on the federal budget deficit examined the effect of the deficit on the ability of Democratic presidential nominee Sen. Barack Obama (Ill.) to implement his health care and other proposals as president. According to the Times, Obama "could feel constrained by the markets, if not by a Democratic Congress," in his proposals to expand health insurance to more U.S. residents and eliminate the so-called "doughnut hole" coverage gap in the Medicare prescription drug benefit (Dickson, Washington Times, 9/22).

Health Care Conference
Attendees at a national conference in Orlando, Fla., on Thursday discussed proposals to improve the U.S. health care system. The Republican White House Writers Group and the Democratic West Wing Writers sponsored the conference, titled "America's Health Care at Risk: Finding a Cure."

During the conference, Irwin Redlener of Columbia University and co-chair of Doctors for Obama, said, "There's a true crisis in American health care. We're looking at a financial meltdown." Sen. Tom Coburn (R-Okla.) said that administrative costs account for $700 billion of the $2.3 trillion spent on health care annually in the U.S. and that "8% of what we spend is for tests that nobody needs." Conference attendees also agreed on the need for a nationwide electronic health record system to reduce health care costs.

Florida Gov. Charlie Crist (R) promoted the Cover Florida program, under which state officials negotiate with private health insurers to design more affordable policies that provide fewer benefits. He said, "Cover Florida can be a role model for the country" (Gentry, Florida Health News, 9/19).

A webcast of the conference is available online.

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation.

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