1. The Impact of Health Expenses on Older Women ’ s Financial Security Juliette Cubanski, Ph.D. The Henry J. Kaiser Family Foundation AcademyHealth 2007 Annual Research Meeting Orlando, Florida 3 June 2007

2. Exhibit 1 Research Questions What are the key differences in health status and utilization of medical and long-term care services between women and men age 65+? What are the key differences in health status and utilization of medical and long-term care services between women and men age 65+? What sources of insurance coverage do older women rely on, and how does this compare to older men? What sources of insurance coverage do older women rely on, and how does this compare to older men? How much do older women and men spend on health care and what is the distribution of spending for various services? How much do older women and men spend on health care and what is the distribution of spending for various services? What is the burden of out-of-pocket health care spending as a share of income among older women, and how does it compare among various subgroups? What is the burden of out-of-pocket health care spending as a share of income among older women, and how does it compare among various subgroups?

3. Exhibit 2 Women’s Economic & Demographic Reality Working-age women have lower incomes than men Working-age women have lower incomes than men Wage disparity and lower workforce participation Wage disparity and lower workforce participation Women accumulate fewer assets for retirement than men Women accumulate fewer assets for retirement than men Lower workforce participation affects social security payments, retiree benefits and income (pensions, IRAs) Lower workforce participation affects social security payments, retiree benefits and income (pensions, IRAs) Women have longer lifespans than men Women have longer lifespans than men At age 65, women are expected to live another 20 years, compared to 17 for men At age 65, women are expected to live another 20 years, compared to 17 for men Women have more long-term care needs than men Women have more long-term care needs than men

4. Exhibit 3 Data and Methods Analyzed 2002 Medicare Current Beneficiary Survey Cost and Use file Analyzed 2002 Medicare Current Beneficiary Survey Cost and Use file Sample population included 6,195 women and 4,396 men age 65 years or older living either in the community or in a facility Sample population included 6,195 women and 4,396 men age 65 years or older living either in the community or in a facility Compared women and men age 65+ on Medicare to assess key differences in age, income, marital status, insurance coverage, health status, and utilization of medical and long-term care (LTC) services Compared women and men age 65+ on Medicare to assess key differences in age, income, marital status, insurance coverage, health status, and utilization of medical and long-term care (LTC) services Examined out-of-pocket spending on health care by aggregating spending on Medicare Parts A and B, supplemental insurance premiums, and all reported medical and LTC services Examined out-of-pocket spending on health care by aggregating spending on Medicare Parts A and B, supplemental insurance premiums, and all reported medical and LTC services Estimated the burden of out-of-pocket health care spending among women and men age 65+ by calculating the ratio of annual out-of- pocket spending on medical care to annual income Estimated the burden of out-of-pocket health care spending among women and men age 65+ by calculating the ratio of annual out-of- pocket spending on medical care to annual income

5. Exhibit 4 Key Demographic, Economic, and Health Status Indicators of Medicare Beneficiaries Age 65+, 2002 Women 65+ (20.8 million) Men 65+ (15.1 million) Average age 76.1 years 74.7 years Percent age 85+ 16%10% Lives alone 41%19% Among 85+, lives alone 59%32% Lives in long-term care facility 6%3% Among 85+, lives in long-term care facility 21%11% Average annual income $25,921$36,161 Percent with income less than $20,000 56%37% Fair/poor health status 26%23% Two or more chronic conditions 65%53% Cognitive/mental impairment 21%17% Two or more limitations in activities of daily living 16%12% Number of home health visits* 122 visits 91 visits Number of prescription drug fills* 3125 NOTE: Health status indicators exclude the institutionalized population. * Utilization among beneficiaries with reported use of service. SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use File.

6. Exhibit 5 Health Insurance Coverage Among Medicare Beneficiaries Age 65+, by Sex, 2002 SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use File. Men 65+Women 65+

7. Exhibit 6 NOTE: Estimates reflect mean out-of-pocket spending for Medicare and private insurance premiums and health care services. SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use File. Women 65+ Total OOP = $83 billion Men 65+ Total OOP = $49 billion $3,991 $3,269 Distribution of Mean Out-of-Pocket Health Spending by Medicare Beneficiaries Age 65+, 2002 $1,450 $1,407 $557 $671 $428 $206 $1,210 $634 $546 $152

8. Exhibit 7 Mean and Median Out-of-Pocket Spending by Women on Medicare Age 65+, by Age, 2002 NOTE: Estimates include out-of-pocket spending for Medicare and private insurance premiums and health care services. SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use file. MEAN MEDIAN

9. Exhibit 8 Out-of-Pocket Spending by Women on Medicare Age 65+, by Age, 2002 NOTE: Estimates include out-of-pocket spending for Medicare and private insurance premiums and health care services. SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use file. Median Out-of-Pocket Spending As Percent of Income Median Out-of-Pocket Spending Men 65+: 14%

10. Exhibit 9 Out-of-Pocket Spending by Women on Medicare Age 65+, by Insurance Coverage, 2002 NOTE: Estimates include out-of-pocket spending for Medicare and private insurance premiums and health care services. SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use file. Median Out-of-Pocket Spending Median Out-of-Pocket Spending As Percent of Income (Total incl. Premiums/Health Care Services Only)

11. Exhibit 10 Out-of-Pocket Spending by Women on Medicare Age 65+, by Race/Ethnicity, 2002 NOTE: Estimates include out-of-pocket spending for Medicare and private insurance premiums and health care services. SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use file. Median Out-of-Pocket Spending As Percent of Income Median Out-of-Pocket Spending

12. Exhibit 11 Out-of-Pocket Spending by Women on Medicare Age 65+, by Income, 2002 NOTE: Estimates include out-of-pocket spending for Medicare and private insurance premiums and health care services. SOURCE: Kaiser Family Foundation analysis of the Medicare Current Beneficiary Survey 2002 Cost and Use file. Median Out-of-Pocket Spending As Percent of Income Median Out-of-Pocket Spending

13. Exhibit 12 Key Findings and Implications Older women have greater health care needs and lower incomes than older men Older women have greater health care needs and lower incomes than older men Long-term care use and spending are key differences between elderly women and men Long-term care use and spending are key differences between elderly women and men Older women spend more out-of-pocket on health care than older men, both in dollars and as a share of their incomes Older women spend more out-of-pocket on health care than older men, both in dollars and as a share of their incomes Pressure to control costs in the private and public health insurance sectors could disproportionately impact older women Pressure to control costs in the private and public health insurance sectors could disproportionately impact older women