U.S. Adults Struggle With Healthcare Cost Literacy
Key Takeaways
- In a weighted national survey of 2,308 U.S. adults, healthcare cost literacy was lower than general health literacy.
- Respondents were more familiar with pharmacy-level prescription price differences than with hospital chargemasters.
- Deductible was easier for respondents to describe than health insurance formulary.
- Estimating emergency room costs ahead of time was harder than anticipating prescription out-of-pocket costs, and higher healthcare cost literacy tracked with older age, greater health literacy, more confidence managing healthcare, more recent doctor visits, and better knowledge of cancer screening guidelines.
Investigators conducted a cross-sectional survey through the YouGov online panel in two waves. The paper reports results for 2,308 respondents overall, although its methods section also states that 310 participants with more than 25% missing HCL items were excluded from analysis. Healthcare cost literacy (HCL) was assessed with a 12-item, 4-point Likert instrument spanning healthcare cost knowledge, health insurance cost knowledge, and preemptive cost planning behaviors, and health literacy (HL) was measured for comparison. Post-stratification weights were based on age, gender, race, education, and political affiliation. HCL was calculated as each respondent's mean item score, with missing-item imputation when at least 75% of items were answered and exclusion when more than 25% were missing; higher- and lower-HCL groups were then defined with a median split for bivariate comparisons.
Average HCL was 2.43 (SD 0.66), compared with a mean HL score of 2.98 (SD 0.50). Familiarity was highest for pharmacy-level prescription price differences, reported by 77%, and lowest for hospital chargemasters, reported by 33%. Confidence around contesting hospital bills fell between those extremes, reinforcing a broader pattern of stronger familiarity with pharmacy pricing than with hospital pricing tools.
Among insurance-related terms, deductible was easiest to describe, with a mean of 2.85 (SD 0.83), whereas health insurance formulary was hardest at 2.10 (SD 0.96). Preemptive cost planning was weakest for estimating emergency room costs ahead of time and easier for anticipating prescription out-of-pocket costs. Higher HCL was associated with older age, greater HL, more confidence managing healthcare, more recent doctor visits, and better knowledge of cancer screening guidelines, and HCL and HL were moderately correlated at r=0.60.
The authors described the survey as cross-sectional, so the findings do not establish causal relationships. They also noted that contrasts between higher and lower HCL were based on bivariate comparisons and may reflect confounding across related demographic, utilization, and literacy factors. Additional caution came from the potential for response bias and from the survey's inclusion of English-speaking respondents only. Even so, the authors framed the results as identifying larger gaps around hospital billing, insurance-related language, and advance cost estimation that may serve as a descriptive national baseline for future measurement work.
Across this U.S. adult sample, HCL varied and did not map one-to-one onto general HL. Familiarity appeared stronger for prescription pricing than for hospital pricing tools, insurance formulary language, or forecasting emergency care costs. The authors reported that these patterns provide a national baseline for healthcare cost literacy.
Clinician Questions
How was healthcare cost literacy measured in U.S. adults in this survey?
Investigators used a 12-item healthcare cost literacy instrument with 4-point Likert responses covering healthcare cost knowledge, health insurance cost knowledge, and preemptive cost planning behaviors. HCL was calculated as each respondent's mean item score, with mean-score imputation when at least 75% of items were answered and exclusion when more than 25% were missing.
Which aspects of healthcare costs were hardest for respondents to understand or anticipate?
Respondents were least familiar with hospital chargemasters, had the most trouble estimating emergency room costs ahead of time, and had more difficulty with health insurance formulary language than with deductible terminology. Those gaps were concentrated in hospital pricing concepts, emergency-care cost forecasting, and insurance vocabulary rather than in prescription price awareness.
What does the survey suggest about the relationship between healthcare cost literacy and general health literacy?
HCL and HL moved together only moderately, and the authors did not treat them as interchangeable. They reported that HCL showed its own pattern of demographic and healthcare-utilization associations, suggesting overlap between the two constructs without full equivalence.
Recommended Reading
- For more on surprise billing and costs: What to Know About the No Surprises Act
- For more on administrative cost barriers: Prior Authorization & the AMA's Push for Reform
- For more on coverage and access questions: Evaluating the Present & Future of Medicare Coverage of Telehealth Services