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CCH® HR MANAGEMENT - 04/24/09

Study shows more people go without health coverage as insurance costs outpace income eightfold

With Congress and the Obama administration discussing how to reform the nation's health care system, a new report from the Robert Wood Johnson Foundation (RWJF) looks at what has happened since the last significant reform effort ended in 1994 without any comprehensive congressional action. The analysis documents the deteriorating scenario:

• More Americans are uninsured. Nationwide, the total number of uninsured has increased by nearly 9 million, to 45.7 million. Across the U.S., 22 percent of men are uninsured, up from 19 percent; 18 percent of women are uninsured, up from 16 percent.

• More working people are uninsured. Nationwide, the number of working uninsured adults has increased by more than 6 million, to 26.9 million. Currently, nearly one in five working adults (18 percent) is uninsured.

• More kids have insurance. Nationwide, the rate of uninsured kids has fallen by 13 percent, to 9.2 million, which experts attribute to more children being covered by government insurance programs like Medicaid and the Children's Health Insurance Program (CHIP).

• Fewer people have private health insurance. Nationwide, the percentage of nonelderly 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.

• Workers' insurance costs have risen far faster than incomes. 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.

"The rising cost of health care has largely been borne by workers who are not getting raises because of it and employers who are seeing these costs eat into their profit margins," said Lavizzo-Mourey. "Fixing our broken health care system is a critical part of fixing the economy, but it will not happen overnight and it won't be easy. Fortunately, a lot of people are working together this time—government and business, doctors and patients, Democrats and Republicans—so that we can achieve real reform. When all Americans have access to affordable health care, everyone will benefit."

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