Revisiting ‘Skin in the Game’ Among Medicare Beneficiaries: An Updated Analysis of the Increasing Financial Burden of Health Care Spending From 1997 to 2005

This data update by Kaiser Family Foundation researchers finds the financial burden of out-of-pocket health care spending by Medicare beneficiaries increasing between 1997 and 2005. During this nine-year period, median out-of-pocket spending as a share of income for people on Medicare climbed to 16.1 percent in 2005, up from 15.6 percent in 2004 and 11.9 percent in 1997. For some beneficiaries, the spending burden was even greater, with 25 percent of people on Medicare spending nearly one-third or more of their income on health care. The analysis does not capture the effects of the Medicare Part D drug benefit, which began in 2006, because the data are not yet available.

The analysis of out-of-pocket health care spending as a share of Medicare beneficiaries’ income updates a paper previously published in Health Affairs and coauthored by Tricia Neuman and Juliette Cubanski of Kaiser, with Katherine Desmond and Thomas Rice of the University of California-Los Angeles.