Premiums, cost-sharing requirements and gaps in Medicare coverage can result in beneficiaries spending a significant chunk of their household budgets on healthcare, according to a Kaiser Family Foundation report.
Based on the 2012 Consumer Expenditure Survey conducted by the Bureau of Labor Statistics, KFF analysts examined the financial burden of out-of-pocket healthcare expenses as a share of household income for Medicare households. Here are five of their key findings.
1. In 2012, health expenses accounted for 14 percent of Medicare household budgets, compared with 5 percent of non-Medicare household budgets.
2. Health insurance premiums make up the largest share of average out-of-pocket spending among Medicare households, accounting for 65.4 percent of overall health spending.
3. Healthcare expenses as a share of average household spending increase with age among Medicare beneficiaries. Those aged 65 to 69 spend an average of 11.7 percent of their household income on healthcare, compared with 15.4 percent for those older than 80. Those aged 75 to 79 spent the largest share of their incomes on health at 16.1 percent.
4. In 2012, near-poor and middle-income Medicare households spent a larger share of their incomes on healthcare than those earning more than 400 percent of the federal poverty level. Those earning 100 to 199 percent of the poverty level ($11,170 for an individual and $15,130 for a couple) spent the largest share on health at 15.7 percent, compared with 12.1 percent for those earning 400 percent or more of the poverty level.
5. Low-income households — those earning below 100 percent of the poverty level — where beneficiaries are eligible for both Medicare and Medicaid spend a smaller portion of their income on healthcare (3.9 percent) than those that only quality for Medicare (14.5 percent).
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