1. Agree on Shared Values and Goals
2. Organize Care and Information Around the Patient
3. Expand the Use of Information Technology
4. Enhance the Quality and Value of Care
5. Reward Performance
6. Simplify and Standardize
7. Expand Health Insurance and Make Coverage Automatic
8. Guarantee Affordability
9. Share Responsibility for Health Care Financing
10. Encourage Collaboration

Printable version of this article
(20 pages)
Distribution of views on who should pay for health insurance
Percentages do not add to 100 percent because of rounding.
Sara R. Collins et al., The Affordability Crisis in U.S. Health Care: Findings from The Commonwealth Fund Biennial Health Insurance Survey, The Commonwealth Fund, March 2004.
The recent rise in health care costs makes affordability a key concern to everyone who contributes to health care financing. Uninsured families are particularly vulnerable, but increases in deductibles and other cost-sharing requirements have made paying medical bills more difficult for all working families. Findings from the 2003 Commonwealth Fund Health Insurance Survey indicate that over 71 million Americans under age 65 have medical bill problems or accumulated medical debt.(45) Sixty-two percent of people who reported those problems said they were insured at the time their bills were incurred.(46) Overall, 17 percent of adults ages 19 to 64 reported out-of-pocket expenses in excess of 5 percent of income.(47)
Those financial burdens could be relieved by establishing ceilings on out-of-pocket liability for individuals, using mechanisms that would effectively ensure that no American is required to spend more than 10 percent of income on health care. Setting a floor on coverage—for example, by extending CHIP coverage to anyone earning below 150 percent of poverty—would be a practical way to guarantee that the most vulnerable do not fall through the cracks in our mixed private-public system of financing.
Even more difficult than restructuring public programs is determining employers' responsibility for financing the health benefits of their employees. Finding the right balance is important, since most Americans—59 percent, according to a recent Commonwealth Fund survey(48) —think that responsibility for health care financing should be shared among individuals, employers, and government. Interestingly, a survey of employers supported by the Fund also found that 59 percent of employers believe that it is very important that employers provide health coverage to their employees or contribute to the cost.(49)
The percentage of workers receiving coverage through their own employers has been slowly eroding for several decades, a trend that appears to have accelerated during the recent economic slowdown.(50) When employers do not cover their own employees, the cost is borne by other employers, government programs, and individuals. An analysis by the Fund indicates, for example, that companies spend roughly $31 billion to provide coverage for dependents who are actually employed by other firms,(51) an inequity that creates a very uneven competitive environment. There is also a risk that if public insurance programs or tax credits were to make other forms of coverage more affordable for workers, employer coverage would erode even more rapidly, with significant budgetary implications for government.
A good strategy here would be to develop a mix of incentives and disincentives to encourage all employers to help finance health coverage for their workers. Employers purchasing qualified coverage for all employees could be eligible for "reinsurance," with the federal government picking up most of the cost for employees with health expenses over a given threshold. Certain tax benefits could be conditional on contributing a minimum amount toward health insurance coverage for employees, and small businesses could be given an opportunity to purchase coverage through a group pool in order to eliminate the premium differential that currently favors large firms.(52)
 
 
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Adults ages 19-64 who spent 5 percent or more of income on out-of-pocket health care costs
Income groups based on 2002 household income. Author's analysis of the Commonwealth Fund Biennial Health Insurance Survey (2003).