The Hidden Tax On Health Insurance
This week is “Cover The Uninsured Week” in the United States. Millions of Americans today live without health insurance; in 2007, there were 46 million Americans without health insurance, which works out to 15% of the population. And a study by Families USA found “86.7 million people—one out of every three Americans under the age of 65—was uninsured for some period of time during 2007 and 2008.” [American Health Care since 1994] [Families USA]
By Christy Harvey, Mic Check Radio
March 24, 2009
(AP/Ric Feld)
Know Five Things
1. Lack Of Insurance For Some Drives Up Costs For All
Wonk Room’s Ben Furnas and Peter Harbage concludes that a failure to continuously cover all Americans accounts “for roughly 8 percent of the average health insurance premium.” From the report: “This cost-shift amounts to $1,100 per average family premium in 2009 and $410 per average individual premium. By 2013, assuming the cost shift remains the same percentage of premium costs, the cost shift will be approximately $480 for an individual policy and $1,300 for a family policy. [American Progress Action Fund]
2. The Current System Is Expensive
According to a new study from the Robert Wood Johnson Foundation this week, people with insurance are less able to afford it. “Nationwide, average costs paid by an employee for an individual health insurance premium have risen nearly eight times faster than average U.S. incomes.” Here are the stats: “Average costs for an individual insurance policy have increased 61 percent—from $2,560 in 1996 to $4,118 in 2006. Nationwide, the amount that employees pay for an individual policy has increased 79 percent, with wages in the U.S increasing just 10 percent over the period.” [Robert Wood Johnson]
3. Effect On American Families
According to a poll last month by the Kaiser Family Foundation, “Slightly more than half (53%) of Americans say their household cut back on health care due to cost concerns in the past 12 months. The most common actions reported are relying on home remedies and over-the-counter drugs rather than visiting a doctor (35%) or skipping dental care (34%). Roughly one in four report putting off health care they needed (27%), one in five say they have not filled a prescription (21%) and one in six (15%) say they cut pills in half or skipped doses to make their prescription last longer.” [Kaiser Family Foundation]
4. Insurers Change Policy
From the Associated Press: “The health insurance industry offered Tuesday for the first time to curb its controversial practice of charging higher premiums to people with a history of medical problems.” The offer came in the form of a letter to key lawmakers from America’s Health Insurance Plans and the Blue Cross and Blue Shield Association. [AP]
5. The Loopholes
“The companies left themselves several outs, however. The letter said they would still charge different premiums based on such factors as age, place of residence, family size and benefits package…Importantly, insurers did not extend to small businesses their offer to stop charging the sick higher premiums. Small employers who offer coverage can see their premiums zoom up from one year to the next, even if just one worker or family member gets seriously ill.” [Washington Post]
Plus
From the Austin-American Statesman: Last week at a Texas House Committee on Human Services hearing, state Rep. Gary Elkins and other members were considering bills related to Medicaid and children’s health insurance. “Three hours into the hearing, Elkins asked: ‘What’s Medicaid? … I know I hear it — I really don’t know what it is. I know that’s a big shock to everybody here in the audience, OK.’” (The Statesman points out that Medicaid comprises a quarter of the state’s budget.) [Austin-American Statesman]
Read Additional Resources
“The Cost Shift from the Uninsured,” Ben Furnas & Peter Harbage, Center for American Progress Action Fund. 03-24-09. [American Progress Action]
- Excerpt: “...This “hidden tax” on health insurance arises from a failure to continuously cover all Americans and accounts for roughly 8 percent of the average health insurance premium. This cost-shift amounts to $1,100 per average family premium in 2009 and $410 per average individual premium. By 2013, assuming the cost shift remains the same percentage of premium costs, the cost shift will be approximately $480 for an individual policy and $1,300 for a family policy…”
“Study Shows More People Go Without Health Coverage as Insurance Costs Outpace Income Eightfold,” Robert Wood Johnson Foundation, 03-24-09. [Robert Wood Johnson]
- Excerpt: “...Nationwide, the percentage of non-elderly people who have private insurance has dropped to 67 percent, down from 73 percent. Alaska, North Carolina, Utah, Vermont, and Virginia have all seen the percentage of privately insured residents erode by 10 percent or more…”
“Insurers offer to stop charging sick people more,” Associated Press, 03-24-09. [Associated Press]
- Excerpt: “...Insurers are trying to head off the creation of a government insurance plan that would compete with them, something that liberals and many Democrats are pressing for. To try to win political support, the industry has already made a number of concessions. Last year, for example, insurers offered to end the practice of denying coverage to sick people. They also said they would support a national goal of restraining cost increases…”
“Americans at Risk: One in Three Uninsured,” Families USA, March 2009. [Families USA]
- Excerpt: “...Four out of five individuals (79.2 percent) who went without health insurance during 2007-2008 were from working families: 69.7 percent were in families with a worker who was employed full-time, and 9.5 percent were in families with a worker who was employed part-time…”
“American Health Care Since 1994: The Unacceptable Status Quo,” CAP, 01/08/09. [American Health Care since 1994]
- Excerpt: “...One indicator of America’s declining health care quality is infant mortality…Despite enormous per-person health expenditures, the United States ranks 26th in the world in infant mortality, behind the Slovak Republic and just ahead of Poland…”
“Survey: Health care cost keeps the doctor away,” AP, 02/26/09. [AP]
- Excerpt: “...One in four Americans said in a survey that someone in the family put off needed health care in the past year because of cost, including 16 percent who postponed surgery or a doctor’s visit for chronic illness…”
Talk to An Expert
Interested in talking with an expert on this topic or hosting a speaking event? Contact speakers@campusprogress.org.
Social Bookmarking
--------
Comments
!
