While public officials, insurance and drug companies, doctors and hospitals wrestle with state and national strategies to provide health care for the growing number of uninsured Americans, we examine steps that can be taken at the local level to get more people the care they need.
A national crisis
Many people believe that how our nation responds to the growing number of uninsured Americans will be a defining issue of this century. There are now 45 million uninsured Americans, 5.2 million more than five years ago. Directly and indirectly, the public absorbs $43 billion in uncompensated care annually.
Because of skyrocketing health care costs, many employers reduce or eliminate health care benefits. Adjusted for inflation, an average 1968 General Motors worker would earn $29,000 today – as well as generous health insurance and retirement benefits. Today, the average Wal-Mart worker makes $17,000 and health insurance plans cover less than half its workers.
Employee health care costs affect the bottom line and threaten global competitiveness. General Motors absorbed $5.2 billion in employee health care costs in 2004. The company posted a $1.1 billion loss in the first quarter of 2005 and announced that 25,000 jobs will be eliminated by 2008. Employee health care costs were a key factor, adding $1,500 to the cost of each vehicle manufactured by the company.
Many companies have been forced to make changes in employee retirement plans. Only 13 percent still provide health insurance to retirees. At the same time, as much as $130 billion per year in lost productivity is due to uninsurance in America.
Who’s insured? Who’s not?
In Daviess County, employer health insurance plans cover nearly 50,000 people, 54 percent of our population. Approximately 3,700 people, or 4 percent, have individual health insurance policies. Medicaid and Medicare insure nearly 26,000 people, or 28 percent.
That leaves nearly 13,000, or 14 percent, uninsured Daviess Countians. For those between the ages of 19-64, the percentage of uninsured jumps to 18 percent.
Nearly 25,000 Daviess Countians go without health insurance at some point during the year. Twelve percent of local youth (18 and under) are uninsured.
The rate of uninsured is higher in surrounding counties served by Owensboro health care providers, reaching 17 percent in the seven-county Green River district.
For those living below the poverty level (earnings below $9,600 per year), 78 percent between the ages of 19-64 have no health insurance. Twenty-two percent of poor youth (18 and under) are uninsured.
For the uninsured non-elderly: 65 percent work full-time; 14 percent work part-time; and 21 percent are not working (which includes the disabled, chronically ill, and family caregivers).
Some reports speculate that the likelihood of being uninsured in the coming year among African Americans (under 65) is as high as 39 percent, compared to 28 percent of whites. (Local data on Latinos is not as available or conclusive.)
Why are so many uninsured?
Many people who are not covered under employer plans simply cannot afford health insurance. Since 2000, premiums for family coverage increased 59 percent – six times faster than inflation.
Healthy people earning the minimum wage ($5.15 per hour) for 35 hours per week would have to spend 30-50 percent of their entire income on health insurance, depending on their age.
Most part-time workers are not eligible for employer benefits, including health insurance.
Contrary to public perception, many poor people do not qualify for Medicaid. In Kentucky, there is no public health insurance available to childless adults, and working parents who earn more than 71 percent of the federal poverty level don’t qualify for Medicaid.
For every 100 people who become unemployed, 85 lose their health insurance. (Kentucky’s unemployment rate was 5.6 percent in April 2005.) Through the COBRA plan, health insurance is available from former employers, but the enrollee must pay 100 percent of the premium; consequently, only one in 14 use it.
Insurance companies often reject people with health problems, regardless of their ability to pay.
Some healthy young people who are not covered by employer plans, even when they can afford health insurance, choose not to purchase it. They feel they can take their chances.
When people lack health insurance, they are less likely to have a “medical home” – a key factor in health education, prevention, and early detection. They are more likely to wait until a condition is dangerous before seeking treatment. They are less likely to fill prescriptions or take medications at the dosage prescribed.
Seventy percent of those without health insurance are in poor health.
Some people who are uninsured pay for their health care directly; most do not. Nationally, 26 percent of health care is paid as an out-of-pocket expense, and 35 percent is uncompensated. That means that because of co-pays and deductibles, health care costs are often not recovered even when people are insured.
The Owensboro Medical Health System (OMHS) Emergency Department is one of the busiest in Kentucky and absorbs most of the uncompensated care in our region. This drives up costs and insurance premiums. In 2003, local retired teachers paid up to $1,800 more annually to purchase health insurance for a spouse than did retired teachers in Paducah.
In 2005 in Kentucky, care for the uninsured will add $1,086 to the annual cost of family health insurance and $385 to individual coverage. This is projected to increase 68 percent by 2010.
Medical problems contribute to about half of all bankruptcies, and this is not just a trend among the uninsured. Many people with health insurance are forced to file bankruptcy when they lose their job and income, or when out-of-pocket health care expenses (co-pays, deductibles, and uncovered services) are too high for them to absorb. In just one week in June 2005, 34 bankruptcies were filed in the nine-county Daviess County district.