2014’s States with the Best & Worst Health ROI

Under the Hippocratic oath, physicians and other health care professionals vow to improve the quality of life. But for whom, exactly? For a country that spends $2.9 trillion a year on health care — twice as much per capita as other industrialized nations — one would think the United States is home to the healthiest humans on the planet. And yet, the reverse is true: Americans have shorter lives, higher infant mortality rates and more cases of chronic diseases than populations of other wealthy countries.

To add insult to injury, someone’s pockets are getting deeper, and it’s definitely not the patient’s. Looks as if Hippocrates left out the clause on offering the best treatment to patients without ruining their finances. In 2013, the average annual health insurance premium for an individual had a price tag of $5,884 while families paid an average of $16,351 for group coverage. To put that in perspective, single coverage has increased by 74 percent and family coverage by 80 percent since 2003. It’s no surprise that millions of Americans consider forgoing medical attention a better option than draining their savings.

As the U.S. undergoes the most sweeping health insurance expansion since Medicaid and Medicare, health care expenditures and standards continue to dominate the discussion regarding policy. And only recently have researchers been able to gauge the number of uninsured Americans after the implementation of the Affordable Care Act. To examine the quality of American health care relative to its cost, WalletHub used data from 47 states to construct a health-related return on investment (ROI) metric. In doing so, WalletHub can educate Americans on the level of care they can expect for the price they must pay in their states.

Main Findings

Ask the Experts

As we’ve determined in this study, expensive health costs are no guarantee of superior care. With that in mind, we’ve asked a panel of experts in various fields for advice on cost-cutting measures and local program implementation. Click on the experts’ profiles to read their bios and responses to the following key questions:

1. Is it possible to buy a nutritious meal at the same price as a fast-food meal? If so, what tips can you offer to people who want to eat healthy but are on a tight budget?
2. What are the most important measures (e.g., opening a health saving account, exercising, etc.) that Americans can take to minimize health-related expenditures?
3. How effective could overtaxing fast food be at encouraging Americans to make healthier meal choices?
4. How effective are awareness campaigns at educating Americans about the benefits of a healthy lifestyle?
5. According to a recent study conducted by the University of Arizona College of Medicine-Phoenix, more than half of all cardiac arrest victims survived in cities with strong training programs and quick EMS response times. In light of that fact, what key changes should local governments implement to duplicate the findings of the study?

Methodology

To highlight the ROI for health care services in 47 of the U.S. states, we looked into three key metrics, including death rates, America’s Health Rankings® and average individual health insurance premiums. Maine, Rhode Island and Vermont were excluded from the analysis due to data limitations.

To calculate the ROI for health care expenditures, WalletHub used the following formula:

• Health ROI = Quality of Health Ranking/Health Care Costs Ranking

Each variable can be broken down as follows:

• To determine the Health Care Costs Ranking, we used the average individual health insurance premiums as a proxy.
• To determine the Quality of Health Ranking, we used America’s Health Rankings® and death rate rankings.

More specifically, we assessed quality based on observed death rates on the following age groups: less than 1-year-old, 1 to 4 years old, 5 to 14, 15 to 24, 25 to 34, 35 to 44, 45 to 54, 55 to 64, 65 to 74, 75 to 84, and 85 and older. All age groups were weighted equally. We also used America’s Health Rankings®, one of the most reliable sources tracking the health of Americans on the state level. America’s Health Rankings® measures health using 27 metrics that range from smoking and obesity to sedentary lifestyle and diabetes.

Source: Data used to create these rankings is courtesy of the Centers for Disease Control and Prevention, America’s Health Rankings® and eHealthInsurance.