CATASTROPHIC HEALTH EXPENDITURE SUBSTANTIALLY UNDERESTIMATES FINANCIAL HARDSHIP IN HOUSEHOLDS WITH CHRONIC CONDITIONS
Author(s)
JIAFAN CHEN, BA, MS1, Yizhi Liang, BS, MS1, MIN HU, PhD2, Stéphane Verguet, PhD3, Boshen Jiao, MPH, PhD1;
1University of Southern California, Department of Pharmaceutical and Health Economics, Los Angeles, CA, USA, 2Fudan University, Department of Health Economics, Shanghai, China, 3Harvard T.H. Chan School of Public Health, Department of Global Health and Population, Boston, MA, USA
1University of Southern California, Department of Pharmaceutical and Health Economics, Los Angeles, CA, USA, 2Fudan University, Department of Health Economics, Shanghai, China, 3Harvard T.H. Chan School of Public Health, Department of Global Health and Population, Boston, MA, USA
OBJECTIVES: Catastrophic health expenditure (CHE) captures only realized out-of-pocket (OOP) spending and may miss hardship arising from foregone care or medical debt. This study quantifies the extent to which CHE underestimates financial hardship among U.S. families with chronic conditions and examines variation by income and insurance status.
METHODS: We analyzed 2018-2023 Medical Expenditure Panel Survey (MEPS) data to construct household-level measures of financial hardship among U.S. families with ≥1 member reporting arthritis, diabetes, chronic obstructive pulmonary disease (COPD), asthma, heart disease, stroke, or cancer. CHE was defined as annual OOP spending exceeding 10%, 25%, or 40% of total household income. Additional hardship included any member reporting medical debt or foregone or delayed care due to affordability. We estimated the prevalence of total financial hardship and the share captured versus not captured by CHE. Analyses were stratified by chronic condition, household income, and insurance status, applying survey weights.
RESULTS: Across chronic conditions, CHE captured only a small share of U.S. households experiencing financial hardship under all thresholds. At the 40% threshold, CHE prevalence ranged from 3% to 5% of households, whereas non-CHE hardship affected 35%-49% across conditions. Non-CHE hardship was more prevalent among low- and middle-income households (42%-45%) than among high-income households (≈32%), and among uninsured households (≈58%) compared with those with public or private insurance (38%-39%). When disaggregated, foregone or delayed care accounted for a larger share of non-CHE hardship than medical debt across conditions. Although lowering the CHE threshold increased the proportion of hardship captured by CHE, substantial shares remained uncaptured relative to non-CHE hardship.
CONCLUSIONS: CHE substantially underestimates financial hardship among U.S. families with chronic conditions, particularly among uninsured and lower-income households. These findings highlight the need for financial protection metrics beyond OOP-based CHE to better capture affordability-related hardship and inform equity-oriented health policy.
METHODS: We analyzed 2018-2023 Medical Expenditure Panel Survey (MEPS) data to construct household-level measures of financial hardship among U.S. families with ≥1 member reporting arthritis, diabetes, chronic obstructive pulmonary disease (COPD), asthma, heart disease, stroke, or cancer. CHE was defined as annual OOP spending exceeding 10%, 25%, or 40% of total household income. Additional hardship included any member reporting medical debt or foregone or delayed care due to affordability. We estimated the prevalence of total financial hardship and the share captured versus not captured by CHE. Analyses were stratified by chronic condition, household income, and insurance status, applying survey weights.
RESULTS: Across chronic conditions, CHE captured only a small share of U.S. households experiencing financial hardship under all thresholds. At the 40% threshold, CHE prevalence ranged from 3% to 5% of households, whereas non-CHE hardship affected 35%-49% across conditions. Non-CHE hardship was more prevalent among low- and middle-income households (42%-45%) than among high-income households (≈32%), and among uninsured households (≈58%) compared with those with public or private insurance (38%-39%). When disaggregated, foregone or delayed care accounted for a larger share of non-CHE hardship than medical debt across conditions. Although lowering the CHE threshold increased the proportion of hardship captured by CHE, substantial shares remained uncaptured relative to non-CHE hardship.
CONCLUSIONS: CHE substantially underestimates financial hardship among U.S. families with chronic conditions, particularly among uninsured and lower-income households. These findings highlight the need for financial protection metrics beyond OOP-based CHE to better capture affordability-related hardship and inform equity-oriented health policy.
Conference/Value in Health Info
2026-05, ISPOR 2026, Philadelphia, PA, USA
Value in Health, Volume 29, Issue S6
Code
HPR153
Topic
Health Policy & Regulatory
Topic Subcategory
Health Disparities & Equity, Public Spending & National Health Expenditures, Risk-sharing Approaches
Disease
No Additional Disease & Conditions/Specialized Treatment Areas