INTENSITY OF HEALTH SERVICES AND
COSTS OF CARE FOR PREVIOUSLY
UNINSURED MEDICARE BENEFICIARIES
J. Michael McWilliams, M.D.
Division of General Medicine
Brigham and Women’s Hospital
Department of Health Care Policy
Harvard Medical School
June 26, 2006
Uninsured Near-Elderly Adults
• ~4 million and growing (Baby Boom)
• Difficulties acquiring coverage
• Greater risk of declines than younger adults
Consequences of uninsurance more severe
• Mortality: HR 1.43 uninsured vs. insured*
HR 1.56 among adults with chronic conditions
• Proposals to expand coverage: Medicare buy-in
*McWilliams, Zaslavsky, Meara, & Ayanian. Health Aff 2004
Study Rationale
“The Committee hypothesizes that…
uninsured persons gaining Medicare coverage
at age 65 use health services more intensively
and incur program costs higher than they
would have had they been continuously
insured prior to age 65… This question is one
that merits further investigation.”
-- Committee on the Consequences of
Uninsurance, Institute of Medicine 2004
Health and Retirement Study (HRS)
• 9,760 Adults ages 51-61 in 1992
• Biennial surveys through 2004
• Broad range of questions
Health insurance coverage
Physician visits in prior 2 years
Hospital admissions in prior 2 years
Medical expenditures in prior 2 years
Study Cohort:
Near-Elderly with Chronic Conditions
• Hypertension (HTN), Diabetes (DM), Heart
Disease (CHD), or Stroke (CVA)
• Excluded deaths and publicly insured
• At least age 66 by 2004
• Insurance status prior to age 65:
Continuously Insured (all)
Ever Uninsured (1+y)
Continuously Uninsured (3+y)
n = 2090
n = 800
n = 401
Statistical Analysis
• Multiple waves before/after 65 (age 59 to 69)
• Comparisons of utilization & expenditures:
Before and after Medicare coverage at age 65
Differential increases
•
•
•
•
GLMs with log link function
GEEs to account for correlated data
Multiple Imputation for missing data
Propensity score weighting to adjust for
observed characteristics at age 59-60
Descriptive Comparisons: Unadjusted
Cont.
Insured
Female (%)
Race & Ethnicity
Black (%)
Hispanic (%)
Household Income
Lowest Decile (%)
Education
<High School (%)
Self-reported Health (1-5)
Ever
Uninsured P-Value
53.8
57.1
<0.001
5.7
3.2
12.2
11.8
<0.001
<0.001
4.9
19.2
<0.001
14.4
2.31
32.9
2.63
<0.001
<0.001
Descriptive Comparisons: Adjusted
Cont.
Insured
Female (%)
Race & Ethnicity
Black (%)
Hispanic (%)
Household Income
Lowest Decile (%)
Education
<High School (%)
Self-reported Health (1-5)
Ever
Uninsured P-Value
55.6
55.6
1.00
9.3
6.6
9.3
6.6
1.00
1.00
11.1
11.1
1.00
23.8
2.48
23.8
2.48
1.00
1.00
Hospital Stays: HTN, DM, CHD, CVA
Unadjusted
Hospital Stays/2y
0.6
Differential Increase
+0.15 (P<0.001)
0.5
Δ <65
-0.01 (P=0.66)
0.4
Δ >65
+0.14 (P<0.001)
0.3
0.2
59
61
63
65
67
Age
Ever Uninsured
Continuously Insured
69
Hospital Stays: HTN, DM, CHD, CVA
Adjusted
Hospital Stays/2y
0.6
Differential Increase
+0.15 (P=0.003)
0.5
Δ <65
-0.04 (P=0.22)
0.4
Δ >65
+0.11 (P=0.01)
0.3
0.2
59
61
63
65
67
Age
Ever Uninsured
Continuously Insured
69
Doctor Visits: HTN, DM, CHD, CVA
Adjusted
Visits/2y
15
Differential Increase
+2.6 (P<0.001)
13
Δ <65
-0.8 (P=0.04)
11
Δ >65
+1.8 (P=0.04)
9
7
59
61
63
65
67
Age
Continuously Uninsured
Continuously Insured
69
Total Medical Costs: HTN, DM, CHD, CVA
Adjusted
Δ >65
+12,700
(P=0.10)
40,000
$ (2004)/2y
35,000
Differential Increase
+19,500 (P=0.005)
30,000
25,000
20,000
Δ <65
-6,800
17,000 15,800
(P=0.008)
15,000
37,000
30,800
24,300
10,200
10,000
5,000
<65
Cont. Insured
>65
Ever Uninsured
Cont. Uninsured
Conclusions
• Significantly greater increases in health
services and expenditures for previously
uninsured adults gaining Medicare coverage
• Uninsured near-elderly adults w/ chronic
diseases required more intensive and costly
care as Medicare beneficiaries than similar
adults who were previously insured
• Higher utilization after 65 exceeded lower
utilization before 65
Policy Implications
• Substantial downstream reductions in services
and costs of care
• Potential offsets to costs of coverage expansion
Total net costs of reform
Costs to Medicare
• Importance of effective targeting
Subsidies for Medicare buy-in
Expand qualifying medical conditions