DIMENSIONS OF HEALTH CARE COSTS
Health care costs can have devastating impacts on individuals, households and the society and economy at large. Health care and public health programs, particularly in the United States, do not operate under ideal market conditions, and this can lead to inaccurate and misleading costs estimates. Our cost estimation method, micro-costing, uses the true cost of resources to provide transparent and consistent estimates.
Furthermore, we need an approach that studies how different dimensions of financial protection can be affected by health care needs. We must understand how individuals and households of different income and poverty levels and social circumstances fare when confronting a health need.
When health needs arise, people cope with multiple financial challenges that are not just direct medical costs. Total treatment costs also include caretakers, food, transportation, etc. In response to covering health expenses, households may also experience damage to their health and economic security over time by reducing consumption of other essential resources.
For example, high health care costs can lead to both direct medical costs and the indirect reduction of income due to illness and days of missed work. Insurance lowers treatment costs directly by decreasing medical costs and facilitating access to medically appropriate care when facing a health need. However, it also lowers cost indirectly by reducing days of missed work for ill household members and their caretakers. This, in turn, results in less lost productivity and income.
The financial and health implications of health needs are interrelated. Understanding this relationship is vital to improving individual and household health and flourishing. It presents a more comprehensive look at the impact of health care costs and highlights the need for universal financial protection.