What do we know about people with high out-of-pocket spending?

October 4, 2017

This chart collection explores the distribution of out-of-pocket spending among people with large employer coverage using the Truven Health Analytics MarketScan Commercial Claims and Encounters Database. We examine trends in out-of-pocket spending by people with employer coverage from 2005 to 2015, as well as spending on diseases most associated with high out-of-pocket spending.


The percent of people with large employer coverage who have high out of pocket spending has increased over the last 10 years. In 2005, slightly over 17% of enrollees spent more than $1,000 (inflation-adjusted to 2015 dollars) on medical care. In 2015, that amount had increased to over 24% of enrollees.


In 2015, enrollees in large employer plans spent an averaged $778 out-of-pocket. Of people with large employer coverage, 24% of enrollees had out-of-pocket spending greater than $1,000, 12% had spending over $2,000, 6% had spending over $3,000, and 2% had spending over $5,000.


In 2015, nearly 6 in 10 high out-of-pocket spender were women. This proportion has been largely consistent over the past 10 years for inflation-adjusted to 2015 dollar out-of-pocket spending levels of over $1,000, $2,000 and $5,000.


The likelihood of having high out-of-pocket spending increases with age. While only about 14% of patients under age 25 spend over $1,000 or more, that rate is over 30% for those aged 45-54 and nearly 40% for 55-64 year olds.


Although average enrollees out-of-pocket spending is under $800, out-of-pocket spending for people receiving treatment for certain diseases tends to higher. Among major disease categories, out-of-pocket spending is highest for enrollees undergoing treatment for diseases of the blood and blood-forming organs ($1,953 on average), congenital anomalies ($1,697 on average), circulatory system ($1,508), and cancer ($1,510 on average). Across all payers nationally, people with a diagnosis of a serious or chronic health condition face higher average out-of-pocket costs.


Extremely high out-of-pocket spending is more common among people with circulatory diseases than most enrollees. On average, 12% of all patients spend more than $2,000 and 2% spend more than $5,000. However, more than a third of patients with heart, arterial, or vein and lymphatic diseases spend over $2,000 per year and 6% spend over $5,000.


Circulatory diseases affect a large number of people and are a leading cause of morality and disease burden in the US. Average out-of-pocket costs for people with a diagnosis of a circulatory illness are nearly double that of the average enrollee out-of-pocket expenditure ($1,508 compared to $778).


Among enrollees undergoing treatment for cancer, colorectal cancer followed closely by lymphatic cancers and urinary organ cancer had the highest out-of-pocket spending. However, some of the people in cancer treatment are undergoing follow-up care. For those receiving active treatment, the most expensive outlay for all cancers was for chemotherapy and radiation treatment ($3,568 on average per enrollee in 2015). The average out-of-pocket expenditure for cancer was $1,510 which nearly twice that of average enrollee spending.


High out of pocket spending levels are not consistent across all forms of cancer. For example, while on average less than a quarter of cancer patients spend over $1,000 for medical treatment, a third of lung cancer patients do. Additionally, more than 1 in 10 patients with either lymphatic, urinary, ovarian, breast, lung, or colorectal cancer spend more than $2,000 a year.


Enrollees with a cancer diagnosis were twice as likely to have spending over $5,000 as all enrollees. Colorectal and lymphatic cancer enrollees were over six times more likely to have high out-of-pocket spending than the average enrollee.  


Mental health and substance use disorders are the top cause of disease burden in the US and is estimated to affect approximately 1 in 5 adults.  Out of pocket spending for enrollees with any mental health issues as well as several conditions such as suicide treatment, Schizophrenia, and dementia are much more likely to be over $1,000, $2,000, and $5,000 than the average enrollee.


Source: Peterson-Kaiser Health System Tracker


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