Use of Health Care Down in Bad Economy -- Are There Any Positives?


Use of Health Care Down in Bad Economy -- Are There Any Positives?

Tuesday, August 17th, 2010 - 12:43
Tuesday, August 17, 2010 - 11:38
The use of routine medical care and elective procedures was down during the recession, The New York Times reports. What are the takeaways as health reform is implemented?

The demand for routine medical care and elective procedures was down during the economic recession, and significantly more so in the United States than in countries with universal health care systems, The New York Times reported here Tuesday.

Because a reduction in demand for health care should drive costs lower, there is a bright side to this news. Indeed, health care prices have recently dipped for the first time in 35 years. But forgoing too much routine medical care will likely lead to more expensive care later on. Finding the right balance will be crucial as health reform goes into effect, bringing an estimated 32 million uninsured Americans into the insurance pool and releasing more demand for health care services.

In a survey of residents from the U.S., Canada, Germany, France and Britain, 26.5 percent of Americans reported reducing their use of routine medical care since the beginning of the recession in late 2007 -- by far the highest in the survey. Researchers attributed this finding to the larger out-of-pocket medical care costs Americans must pay to get care and the fact that roughly 15 percent of Americans are currently uninsured.

This is significant under health reform for a number of reasons. Some experts believe the country is in the process of turning toward more low premium, high deductible insurance plans -- a belief backed up by recent statistics that show this is, indeed, happening. These types of plans can have a positive impact on the health care market, in terms of reducing costs, because they presumably make consumers more aware of what each component of their medical care costs. A consumer may be unwilling to get that borderline test or procedure if he or she is going to have to pay more out-of-pocket for it. Of course, this disincentive for care can't be carried too far because that will simply prevent people from getting routine care before a small problem becomes a big one -- one of the central complaints about a health care system that relies too much on reacting to diseases instead of preventing them.

The survey findings also suggest that in a few years, once the uninsured are brought into the coverage fold, that the use of routine medical care in the U.S. should move closer to the levels found in countries with universal health care. This would suggest that demand for routine care will remain fairly steady even in times of economic downturn. So reducing costs will be crucial.

This will be the tough balancing task under health reform: reducing the demand for too many borderline tests, procedures and care while not undermining the move toward preventative care that saves money in the long run.