Health Care Expenses and Financial Hardship Among Medicare Beneficiaries With Functional Disability.

Importance: Medicare beneficiaries with functional disabilities often require more medical care, leading to substantial financial hardship. However, the precise magnitude and sources of this hardship remain unknown. Objectives: To quantify the financial burden from health care expenses by functional disability levels among Medicare beneficiaries. Design, Setting, and Participants: This cross-sectional study used data, including demographic and socioeconomic characteristics, health status, and health care use, from a nationally representative sample of Medicare beneficiaries from the 2013 to 2021 Medical Expenditure Panel Survey. Functional disability was measured using 6 questions and categorized into 3 levels: none (no difficulties), moderate (1-2 difficulties), and severe (≥3 difficulties). Data were analyzed from December 2023 to March 2024. Main Outcomes and Measures: Financial hardship from health care expenses was assessed using objective measures (annual out-of-pocket spending, high financial burden [out-of-pocket spending exceeding 20% of income], and catastrophic financial burden [out-of-pocket spending exceeding 40% of income]) and subjective measures (difficulty paying medical bills and paying medical bills over time). We applied weights to produce results representative of national estimates. Results: The sample included 31 952 Medicare beneficiaries (mean [SD] age, 71.1 [9.7] years; 54.6% female). In weighted analyses, severe functional disability was associated with a significantly higher financial burden from health care expenses, with out-of-pocket spending reaching $2137 (95% CI, $1943-$2330) annually. This exceeded out-of-pocket spending for those without functional disability by nearly $700 per year ($1468 [95% CI, $1311-$1625]) and for those with moderate functional disability by almost $500 per year ($1673 [95% CI, $1620-$1725]). The primary factors that played a role in this difference were home health care ($399 [95% CI, $145-$651]) and equipment and supplies ($304 [95% CI, $278-$330]). Beneficiaries with severe functional disability experienced significantly higher rates of both high and catastrophic financial burden than those without disability and those with moderate disability (13.2% [12.2%-14.1%] vs 9.1% [95% CI, 8.6%-9.5%] and 9.4% [95% CI, 9.1%-9.7%] for high financial burden, respectively, and 8.9% [95% CI, 7.8%-10.1%] vs 6.4% [95% CI, 6.1%-6.8%] and 6.0% [95% CI, 5.6%-6.4%] for catastrophic financial burden, respectively). Similar associations were observed in subjective financial hardship. For example, 11.8% (95% CI, 10.3%-13.3%) of those with severe functional disability experienced problems paying medical bills, compared with 7.7% (95% CI, 7.6%-7.9%) and 9.3% (95% CI, 9.0%-9.6%) of those without functional disability and those with moderate functional disability, respectively. Notably, there were no significant differences in financial hardship among those with Medicaid based on functional disability levels. Conclusions and Relevance: In this cross-sectional study of Medicare beneficiaries, those with severe functional disability levels experienced a disproportionate burden from health care costs. However, Medicaid played a pivotal role in reducing the financial strain. Policymakers should explore interventions that effectively relieve the financial burden of health care in this vulnerable population.