Cost and personal income are the key determinants of whether a Michigander seeks medical care.

As the chart shows, cost is the #1 reason uninsured people in Michigan didn’t seek medical care for 55% of the uninsured. But for nearly 1 in 3 insured Michiganders, cost is also the key determinant in whether people go for medical care.

These findings price elastic demand for health services were uncovered in the Cover Michigan survey, conducted by the Center for Healthcare Research and Transformation (CHRT), a partnership between the University of Michigan and Blue Cross Blue Shield of Michigan (BCBS MI). The survey polled 1,022 adults in Michigan, the bulk of whom had health coverage.

Workers in manufacturing jobs are particular worried about losing health insurance coverage; CHRT points out that manufacturing workers are “joining those in the retail and service sectors,” who have traditionally felt health-insecure. Manufacturing jobs in Michigan translate to jobs at Ford, GM and Chrysler, et. al.

There’s a direct correlation between employment insecurity and health insurance insecurity. 2 in 3 Michiganders are “very worried” about losing health insurance and their job.

Health Populi’s Hot Points: This survey has crucial implications for health reform. Coverage alone won’t get people to use health services. Education and income play important roles in enabling health citizens to become health literate consumers.

For employers who continue to provide health insurance, it’s crucial to also design the plans for accessibility and usability. As companies will levy higher copays and premium shares onto their workers, firms need to make sure these plan designs don’t result in unintended consequences — primarily, moving the worker from the inelastic demand curve of health seeking to the elastic demand where the worker chooses to opt out of seeking care when necessary. This has been a flaw in many consumer-directed plan designs and increasingly in more traditional designs where the stick is used in absence of carrot-motivational nudges.

Michigan provides the scenario of “thinking the unthinkable,” with the highest level of unemployment in the country and arguably the most difficult and jobless recovery in the nation. Pay attention to this scenario; it’s the snapshot proving the interconnection between jobs, health coverage, and medical care demand.

2 Comments on Learning from Detroit: costs above coverage and the elastic demand for health

ljsteele5 said : Guest Report 13 years ago

Jane, I am one of the privately insured in Michigan (having lost group coverage when my job was eliminated last year) who needs health care attention (prevention screening for the type of cancer that my mother is battling; a hip replacement as a result of a serious injury 14 years ago) but am delaying it because I cannot afford the deductible and co-pays.

Rajiv Mehta said : Guest Report 13 years ago

Jane -- It seems to me that both of the top answers in the table amount to the same thing: the person did not seek medical care because of money. Which means that 76% of the uninsured and even 52% of the insured were deterred from health services because of cost. Even more support for your Hot Points.

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