Out-of-Pocket Costs Among Rural Medicare Beneficiaries

Research center:
Lead researcher:
Project funded:
September 2011
Project completed:
December 2015

Problem: Twenty-one percent of individuals covered by Medicare live in rural counties. Although Medicare provides near-universal coverage for seniors, and is an important source of health insurance for individuals with disabilities, many face gaps between the care they need and the costs Medicare will cover. These gaps can be damaging to beneficiaries financial well-being, and put them at risk of problems accessing health care services. However, the rural-urban differences in cost sharing for Medicare beneficiaries are not well understood.

Project Goals: The issue of redesigning Medicare beneficiary cost sharing has begun to attract the attention of researchers and policymakers. In its June 2010 Report to Congress, MedPAC recommended changing the benefit design of Medicare and the plans that supplement it to promote care coordination and incentivize services with substantial clinical benefit, while protecting low-income beneficiaries from high cost sharing. The goal of this project is to provide a better understanding of the out-of-pocket burden for medical care faced by rural versus urban Medicare beneficiaries, as well as the factors that account for any differences. In this way, efforts to reform Medicare can be informed about the potential implications for rural residents.

Methods: This study will use the 2006-2009 panels of the Medical Expenditure Panel Survey (MEPS) to identify the extent to which the out-of-pocket costs experienced by rural community-dwelling Medicare beneficiaries differ from those of their urban counterparts. Separate analyses will be conducted for the elderly beneficiary population and for those whose Medicare eligibility is the result of a disabling condition. Using bivariate and multivariate techniques, we will identify whether rural-urban differences exist in aggregate out-of-pocket costs, and for different health care services, and what factors account for any observed differences.

Anticipated Products/Products: Anticipated products include a working paper, a research and policy brief, and, if warranted, submission to a peer-reviewed journal such as the Journal of Rural Health, Health Affairs, or The Gerontologist. Additionally, abstracts will be submitted for presentation at the annual meetings of the National Rural Health Association and AcademyHealth.