High prices, low value -- Two new composite scores from West Health and Gallup illustrate America’s healthcare cost crisis
An estimated 112 million (44%) American adults are struggling to pay for healthcare, and more than double that number (93%) feel that what they do pay is not worth the cost. The findings come from two new composite scores developed by the nonprofit, nonpartisan organization West Health and Gallup, the global analytics and advice firm, to assess the healthcare cost crisis.
The West Health-Gallup Healthcare Affordability Index and Healthcare Value Index are drawn from the opinions of more than 6,600 American adults and represent findings from one of the largest surveys fielded during the pandemic on the state of healthcare in America. Each index is comprised of three unique metrics and classifies adults into corresponding categories based on their experiences. The Healthcare Affordability Index assesses the public’s ability to afford the healthcare they need, while the Healthcare Value Index synthesizes Americans’ perceptions of the quality-of-care relative to cost. West Health and Gallup developed these metrics after the rate of Americans reporting skipping needed care due to cost tripled during 2021.
“These indices are tracking the healthcare cost crisis in America and its impact on everyday Americans,” said Tim Lash, President of West Health. “Bottom line – Americans are increasingly getting priced out of the system and many of those who can still afford to pay don’t think they’re getting their money’s worth relative to the cost. We must begin to change this trajectory with smarter policies that put patients over profits.”
National health spending is over $4 trillion in this country, and current projections indicate it will continue to grow at an annual rate of 5.4%, topping $6.2 trillion by 2028.
According to the Healthcare Affordability Index, respondents are considered “cost desperate” if they report experiencing three key financial challenges:
- Unable to pay for needed medical treatment over the prior three months.
- Skipped prescribed medication due to cost over the prior three months.
- Unable to afford quality care if it was needed today.
Those classified as “cost insecure” have one or two of these affordability challenges, while cost secure individuals report none of these challenges and are able to consistently access and pay for prescription medications and quality care.
Based on these classifications, 36% of Americans are "cost insecure," 8% are “cost desperate" and 56% are “cost secure.” The likelihood of being cost desperate is more than four times greater for those in households earning under $48,000 per year (13%) compared to those earning $90,000+ per year (3%). Men were more likely to be cost secure than women (60% to 53%) and Hispanic adults were less likely to be cost secure than their Non-Hispanic White counterparts (51% to 58%).
Over one-third (35%) of cost desperate adults report that they have cut back on utilities, and half have cut back on food in the past 12 months to pay for necessary healthcare, rates that are 10 times greater than their cost secure counterparts. Another 14% of this group know a friend or family member who has died in the last 12 months after not receiving treatment due to an inability to pay for it—double the rate of “cost insecure” individuals and seven times greater than “cost secure” individuals.
Beyond affordability, few Americans believe they get good value when they weigh the quality of their care against the amount that they pay for it. The Healthcare Value Index classifies respondents in the following ways:
- “High Perceived Value": These persons (5% of the U.S. adult population) report that both their household and Americans generally are paying the right amount (or too little) relative to the quality of care they receive and that their most recent care experience was worth the cost.
- "Inconsistent Perceived Value": These persons (50% of the U.S. adult population) report that either their household or Americans generally are paying too much for the quality of the care that they receive or that their most recent care experience was not worth the cost.
- "Poor Perceived Value": These persons (45% of the U.S. adult population) report that both their household and Americans generally are paying too much for the quality of the care they receive and that their most recent care experience was not worth the cost.
“These estimates are important resources for policymakers, researchers, and the public to evaluate and understand the burden of high healthcare costs,” said Dan Witters, a senior researcher for Gallup. “The indices paint a comprehensive picture of why Americans are unable to keep pace with the rising costs and don't see value in the care they are receiving.”
Methodology
The results are based on a nationally representative survey conducted by web over successive field periods of Sept. 27-30 and Oct. 18-21 of 6,663 American adults aged 18 and older, living in all 50 U.S. states and the District of Columbia, as a part of the Gallup Panel. For results based on these monthly samples of national adults, the margin of sampling error at the 95% confidence level is +1.5 percentage points. For reported subgroups, such as by age, political identity, household income or race/ethnicity, the margin of error is larger, typically ranging from ±3 to ±5 percentage points.
