Uninsured Americans Raise Medicare Expenditures

Once they pass 65, they need more care than the previously insured, study finds

WEDNESDAY, July 11, 2007 (HealthDay News) -- Americans who weren't insured before they reached age 65 and gained access to Medicare cost the program a lot more than those who did have health insurance, a new study finds.

Data on more than 5,000 older people from a national study found that the previously uninsured needed 13 percent more doctors visits, experienced 20 percent more hospitalizations and had 51 percent higher total medical expenditures after their care began to be covered by the government program.

"Providing health insurance coverage for these adults [before age 65] could not only improve their health but also partially offset the costs of expanding coverage," said Dr. J. Michael McWilliams, a research associate in the Harvard Medical School department of health care policy and lead author of a report in the July 12 New England Journal of Medicine.

The report did not attempt to estimate the possible savings for Americans over 65 if earlier coverage had been provided to all. "Short of a randomized trial, it would be difficult to know exactly what the effect would be," McWilliams said.

However, health coverage earlier in life clearly would provide benefits in terms of Americans' quality of life, he said. "For uninsured adults in this age group, the consequences of being uninsured can be quite impressive," McWilliams said.

The boost in Medicare expenditure for the previously uninsured was concentrated among adults with some of the most common chronic conditions -- high blood pressure, diabetes, heart disease and stroke, according to the researchers. There was no comparable increase in medical care demands among adults who were uninsured during their 50s and 60s but had none of those conditions, when compared to a matched group that had medical insurance during those years.

In all, the study included 5,158 adults, 1,385 of whom did not have medical insurance before they turned 65 and 3,773 who did.

The greater health care needs for previously uninsured persons with chronic conditions persisted at least through age 72, McWilliams noted.

Another expert said the findings came as no surprise.

"This study demonstrates conclusively what common sense tells us -- that people with ongoing health care coverage are healthier people," said Robert M. Hayes, president of the Medicare Rights Center, a consumer advocacy group based in New York City.

Offering government health care insurance before age 65 "will mean that people entering Medicare will be in better health with less expensive health care needs," Hayes said. While newer studies "suggest that such coverage will provide savings on high-cost medical care, ultimately it is more an issue of values and morality than money," he said.

The Harvard report comes at a time when the future of Medicare is being hotly debated. According to the researchers, the program now covers nearly 43 million older and disabled Americans, with a 2006 cost of $374 billion -- 14 percent of the federal budget. Federal spending on Medicare is predicted to reach $524 billion in 2011.

Jonathan Weiner is professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health in Baltimore. He said he was disappointed that the Harvard report lacked any estimate of the potential Medicare savings for the over-65 group if coverage were provided earlier for the uninsured.

"I also would have liked more on its effect on the quality of life as well as the impact on length of life," Weiner said. "But I could hazard a guess that society would save money, and there is no question these people would be healthier and have a higher quality of life if they had insurance earlier."

Getting health insurance remains a challenge for people in the 60- to 64-age group, especially, Weiner said, because more than half are unemployed and thus outside the reach of company-provided coverage.

"Health care is especially expensive for this age group," he said. "Fixing this part of the problem clearly will not be cheap, and exactly where health insurance policy would impact longevity is unclear."

More information

Basic information on health insurance (including an estimate of the number of uninsured Americans) is available from the U.S. National Library of Medicine.

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