Catastrophic illness expense: Implications for national health policy in the United States

Unlike other aspects of American health experience, there is a current void of accurate statistics on expensive illness experiences. This paper is designed to fill this void. Accurate information will allow the development of an improved framework for discussions of the cost of national health insurance and methods of containing the growth of medical price inflation (insofar as it is affected by large medical expenses) and overall medical expenditure growth. This paper presents a preliminary cross-sectional analysis of the incidence and cost of catastrophic illness in the United States, where catastrophic illness is defined as an illness episode for which a person incurs 55000 or more of medical expenses in a calendar year. The following data are included in the profile: the incidence rate of a catastrophic illness, the average cost of a catastrophic episode, the total number of individuals who incur catastrophic expenses, and the total national cost of all catastrophic episodes. The demographic profile disaggregates these results by specific age, sex, income, and geographic region categories.