Recession Spells Bad News for Healthcare

June 11, 2009
Special Feature

A recent survey has measured the impact of the recession on America�s healthcare habits, and the results are a red flag for providers.

For months there has been anecdotal evidence that the nation’s economic woes were spilling over into the healthcare sector, an area that once was thought of as recession-proof. The old rule of thumb was that people needed to take care of their health, even when hard times made it difficult. Now, however, a recent survey has measured the impact of the recession on America’s healthcare habits, and the results are a red flag for providers.

Although the ranks of the uninsured haven’t risen, the reason for not having insurance has shifted, according to the survey. The percentage of people who said they couldn’t afford insurance jumped more than 11% over a previous survey done in 2006. In addition, more people are dropping insurance entirely instead of tweaking deductibles, co-pays, and benefits to lower the cost. The bottom line for providers is a greater number of uninsured who are under financial pressure, which increases the risk of bad debt.

Another survey finding that has implications for providers is the number of people who are postponing or cancelling healthcare services. In the 2006 survey, 15% said they were putting off or cancelling healthcare. The current survey puts that number at 20%. Perhaps more significant is that, once again, the rationale behind the delays has shifted from convenience to cost. The survey also shows that, although most of the drop-off is in doctor visits, up to 10% of those surveyed are postponing revenue-producing non-elective procedures as well as diagnostic and imaging procedures.