HFMA NEWS

Public spending for health care goes disproportionately to seniors and those in poor health, but it is less concentrated among low-income Americans than is sometimes thought. In a study published July 29 on the Health Affairs web site, government analysts provide the first study since the 1970s that comprehensively analyzes the distribution of healthcare outlays and healthcare tax subsidies provided by federal, state, and local governments. By breaking down public spending on health by age, race, sex, health status, coverage status, and income, the work fills important knowledge gaps as the United States begins a fundamental debate over the role of the public sector in the healthcare system.

Using the most recent data available in sufficient detail, Healthcare Research and Quality (AHRQ) researchers report that public outlays and tax expenditures constituted 56.1 percent of all healthcare spending in 2002. Overall, public spending on the civilian, noninstitutionalized population averaged $2,612 per person. Of that amount, $1,867 per person came from outlays through Medicare, Medicaid, and other programs, while $745 per person came from health-related tax subsidies, predominantly the exclusion of the value of employer-sponsored health insurance from federal and state taxes.

Some groups benefited from public-sector health spending more than others. Public spending in 2002 disproportionately flowed to those age 65 and over. Medical expenses tend to increase with age, so it is perhaps not surprising that the average senior received $6,921 in public spending, more than five times as much as the average child ($1,225). Read the abstract.

The monthly rate of complaints from Medicare beneficiaries about the prescription drug benefit decreased by 74 percent during the 18-month period that ended on Oct. 31, 2007, according to a report recently released by the Government Accountability Office (GAO). For the report, GAO examined almost 630,000 complaints filed with the Centers for Medicare and Medicaid Services (CMS) during the review period. The monthly rate of complaints decreased from a peak of 2.86 complaints per 1,000 Medicare beneficiaries in May 2006 to 0.73 in October 2007, and the time needed to resolve complaints decreased from 33 days to nine days, the report found.

However, the report found that CMS did not resolve many of the most important complaints--those that involve Medicare beneficiaries who might exhaust their supplies of necessary medications--in an adequate amount of time. According to the report, CMS should resolve complaints that involve Medicare beneficiaries who have less than a two-day supply of necessary medications within two calendar days, but the agency on average took 12 days to resolve such complaints. Read the report.