Out-of-Pocket Financial Burden for Low-Income Families with Children: Socioeconomic Disparities and Effects of Insurance


  • Alison A. Galbraith,

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    • Address correspondence to Alison A. Galbraith, M.D., M.P.H., Department of Ambulatory Care and Prevention, Harvard Pilgrim Health Care and Harvard Medical School, 133 Brookline Avenue, 6th floor, Boston, MA 02215. Sabrina T. Wong, R.N., Ph.D., is with the School of Nursing, University of British Columbia, Vancouver, BC. Sue E. Kim, Ph.D., M.P.H., is with the Medical Effectiveness Research Center for Diverse Populations and Paul W. Newacheck, Dr.P.H., is with the Institute for Health Policy Studies, University of California, San Francisco, CA.

  • Sabrina T. Wong,

  • Sue E. Kim,

  • Paul W. Newacheck


Objective. To determine whether socioeconomic disparities exist in the financial burden of out-of-pocket (OOP) health care expenditures for families with children, and whether health insurance coverage decreases financial burden for low-income families.

Data Source. The Household Component of the 2001 Medical Expenditure Panel Survey.

Study Design. Cross-sectional family-level analysis. We used bivariate statistics to examine whether financial burden varied by poverty level. Multivariate regression models were used to assess whether family insurance coverage was associated with level of financial burden for low-income families. The main outcome was financial burden, defined as the proportion of family income spent on OOP health care expenditures, including premiums, for all family members.

Data Collection/Extraction. We aggregated annual OOP expenditures for all members of 4,531 families with a child <18 years old. Family insurance coverage was categorized as follows: (1) all members publicly insured all year, (2) all members privately insured all year, (3) all members uninsured all year, (4) partial coverage, or (5) mix of public and private with no uninsured periods.

Principal Findings. A regressive gradient was noted for financial burden across income groups, with families with incomes <100 percent of the Federal Poverty Level (FPL) spending a mean of $119.66 OOP per $1,000 of family income and families with incomes 100–199 percent FPL spending $66.30 OOP per $1,000, compared with $37.75 for families with incomes >400 percent FPL. For low-income families (<200 percent FPL), there was a 785 percent decrease in financial burden for those with full-year public coverage compared with those with full-year private insurance (p<.001).

Conclusions. Socioeconomic disparities exist in the financial burden of OOP health care expenditures for families with children. For low-income families, full-year public coverage provides significantly greater protection from financial burden than full-year private coverage.