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Health Care Costs and Financing

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Rising health care costs may underlie the decline in employment of people with costly chronic conditions

A new book presents the latest research on the causes of the decline in employment of working-aged people with disabilities. According to one chapter, the rising prevalence of high-cost chronic conditions and reduced employment of people with disabilities who have such conditions accounted for a small amount of the overall decline in employment.

In the chapter, Steven C. Hill, Ph.D., of the Agency for Healthcare Research and Quality, and his Cornell University colleagues analyzed data from the 1987 National Medical Expenditure Survey and the 1996 and 1997 Medical Expenditure Panel Surveys to chart the rising prevalence of chronic conditions and to compare expenditures and health insurance coverage of working-aged people with chronic health conditions in 1987 and 1996-1997.

They also used data from the 1984-1996 National Health Interview Survey to measure the rising prevalence of high-cost chronic conditions and trends in employment among working-aged people with work limitations. Analysis revealed that mean health care costs increased 10 percent between 1987 and 1996-1997 for all working-aged people, but they increased by 37 percent for those with high-cost chronic conditions such as HIV, liver cancer, multiple sclerosis, and schizophrenia.

The proportion of working-aged people with high-cost chronic conditions rose by nearly half from 1.1 percent in 1987 to 1.6 percent in 1996-1997. Among people with work limitations, the percentage with high-cost chronic conditions increased from 5.4 percent in 1984-1987 to 7.0 percent in 1993-1996. The employment rate of those with high-cost chronic conditions, including those without disabilities, fell by 3.4 percent over the period, while the employment rate of all other health care cost groups significantly increased. Among people with work limitations, those with high-cost chronic conditions were less likely to be employed than other disabled workers.

See "Rising health care expenditures and the employment of people with high-cost chronic conditions," by Dr. Hill, Gina A. Livermore, Ph.D., and Andrew J. Houtenville, Ph.D., in The Decline in Employment of People with Disabilities: A Policy Puzzle (pp. 181-215). David C. Stapleton and Richard V. Burkhauser, editors. Kalamazoo, MI: Upjohn Institute, 2003.

Chapter reprints (AHRQ Publication No. 03-R062) are available from the AHRQ Publications Clearinghouse.

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