Does public insurance provide better financial protection against rising health care costs for families of children with special health care needs?

BACKGROUND: Health care costs grew rapidly since 2001, generating substantial economic pressures on families, especially those with children with special health care needs (CSHCN).

OBJECTIVE: To examine how the growth of health care costs affected financial burden for families of CSHCN between 2001 and 2004 and to determine the extent to which health insurance coverage protected families of CSHCN against financial burden.

RESEARCH DESIGN AND SUBJECTS: In 2001-2004, 5196 families of CSHCN were surveyed by the national Medical Expenditure Panel Survey (MEPS).

MEASURES: The main outcome was financial burden, defined as the proportion of family income spent on out-of-pocket (OOP) health care expenditures for all family members, including OOP costs and premiums. Family insurance coverage was classified as: (1) all members publicly insured, (2) all members privately insured, (3) all members uninsured, (4) partial coverage, and (5) a mix of public and private with no uninsured periods.

RESULTS: An upward trend in financial burden for families of CSHCN occurred and was associated with growth of economy-wide health care costs. A multivariate analysis indicated that, given the economy-wide increase in medical costs between 2001 and 2004, a family with CSHCN was at increased risk in 2004 for having financial burden exceeding 10% of family income [odds ratio (OR) = 1.39; P < 0.01]. Similar findings were noted for financial burden exceeding 20% of family income. Over 15% of families with public insurance had financial burden exceeding 10% of family income compared with 20% of families with private insurance (P < 0.05; chi2 test). After controlling for covariates, publicly-insured families of CSHCN had significantly lower likelihood of financial burden of >10% or 20% of family income than privately-insured families.

CONCLUSIONS: Rising health care costs increased financial burden on families of CSHCN in 2001-2004. Public insurance coverage provided better financial protection than private insurance against the rapidly rising health care costs for families of CSHCN.