For months Americans have been staring google-eyed at the careening numbers that dictate our future: the Dow, bailout/rescue costs (estimates, always estimates) and interest rates. At the same time weve fixated on polling numbers, followed by electoral votes. We are immersed in data.
Health care offers up its own bellwethers. Our employer-based system of private insurance will probably not vanishthe way of Bear Stearns and Lehman Brothersbut a few statistics herald its decline.
First, as of the last now out-dated, underestimated count, about 15% of the population45.7 million peoplehave no health insurance. (In 2000, the figure was 38.4 million). That marks a slight dip from the January 2008 peak of 47 million. The key to the modest dip was the government. Enrollment in state Medicaid programs rose by 1.3 millionaccounting for the good news decrease. Enrollment in employer-sponsored insurance is inching down; enrollment in government-sponsored insurance is inching up.
That 15% uninsured figure is deceivingly sanguine. Take retirees and people severely disabled out of the calculation. They are covered under Medicare. Looking at the rest of the populationworking America, including its childrenthe percentage uninsured reaches almost 25%. Ask everybody you meet in a typical day: the barista who whips up your latte, the mechanic who repairs your car, the person who cleans your workplace, the ticket-taker at the movies. Most of them have no health insurance. Texas wins the prize for the most uninsured. In Harris County (Houston) in 2005, 32% of residents younger than 65 had no health insurance. (Houston Chronicle, Oct. 9, 2008).
Second, the costs of employment-based insurance are rising beyond inflation. Towers Perrin Health Care does an annual survey. It projects that the corporate bill for family coverage will come to an average of $14,244 in 2009. Employers pay on average 78% of the tab, leaving employees with a whopping 22%. Out-of-pocket expenses, co-pays, deductibles and premiums can swallow up as much as 20% of a workers salary. (Not surprisingly, as costs rise, the number of firms offering coverage, as well as the number of employees electing coverage, drops.)
Any upturn in layoffs will change those statistics. In the last few months, thousands of employees have lost their jobs. Unless those workers pay for insurance under COBRA (ex-employees pay the full freightas much as $14,000 for a family plan, more if the employee is disabled, since COBRA demands higher premiums for disabled ex-employees), they will be uninsured. Indeed, so long as unemployment edges up and the Dow edges down, the census of the uninsured will rise. In another year, we may look back nostalgically on the time when only 15% of us had no insurance.
Outside the group-market of employer-based coverage, the downsized workers have always had the option of the individual market. That market, though, is closing its doors to all but the healthy: One survey estimates that 15% of people who shop in this market will be turned away (www.gohealthinsurance.com/data_report_download.pdf). These applicants are too potentially expensive. (Women with prior cesareans or who are pregnant may fall into this catch-all) The reason is not that we Americans have grown dramatically sicker over the past decade. These insurers have simply grown more selective. Are you obese? Ever had asthma? Cancer (any kind)? Do you have diabetes? A yes can get you exorbitant premiums, or rule you out. As insurers screen out more poor risks, this market will wither.
One more statistic bears watching: the number of hospitals that flee their uninsured patients. Rhetoric aside, for-profit hospitals exist to make a profit; shareholders expect no less. Those hospitals cannot operate for long at a loss. As for nonprofit hospitals, with mission statements that stress service to the community, including the uninsured parts of the community, even those hospitals ultimately have a tipping point. To date, nonprofit hospitals have subsidized the care of patients who cannot pay with fees from paying patients. But when the ratio of uninsured to insured rises too high, hospitals will rethink their largesse. It is already happening. Nonprofit hospitals have started to flee inner-cities, full of poor and uninsured patients, for the suburbs.
How high can the percentage of Americans without insurance reach before the system itself collapses? Stay tuned.
Joan Retsinas is a sociologist who writes about health care in Providence, R.I. Email email@example.com.
From The Progressive Populist, December 1, 2008
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