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A sustained economic recession and escalating health insurance premiums could raise the number of uninsured to 51.2 - 53.7 million in 2006. This represents an addition of at least 10 million Americans to the ranks of the uninsured.

Most Americans have health insurance through their employers. But employment is no longer a guarantee of health insurance coverage.

As America continues to move from a manufacturing-based to a service economy, employee working patterns continue to evolve.

An increasing reliance on part-time workers means fewer workers have access to employer-sponsored health insurance coverage. And due to rising premiums, many small employers cannot afford to offer health insurance. Companies that do offer health insurance often require employees to contribute a larger share toward their coverage. As a result, an increasing number of Americans have opted not to take advantage of job-based health insurance because they cannot afford it.

Facts on Health Insurance Coverage

Who are the uninsured?

  • Approximately 45 million Americans, or 15.6 percent of the population, were without health insurance coverage in 2003. The number of uninsured rose 1.4 million between 2002 and 2003. (Carmen deNavas-Walt, Bernadette Proctor, Robert J. Mills, “Income, Poverty, and Health Insurance Coverage in the United States: 2003,” U.S. Census Bureau Report, August 2004.)
  • The number of people who got their health insurance coverage through their employers fell by 1.3 million between 2002 and 2003, while the number of people covered by government health insurance programs (such as Medicare and Medicaid) rose by 3.2 million. (Carmen deNavas-Walt et al, Ibid.)
  • The number of uninsured children in the United States remained constant between 2002 and 2003, remaining at 11.4 percent of all children, or 8.4 million on 2003. (Carmen deNavas-Walt et al, Ibid; Robert J. Mills and Shailesh Bhandari, “Health Insurance Coverage in the United States: 2002,” U.S. Census Bureau Report, September 2003).
  • Although Medicaid insured 13.3 million poor people, another 10.1 million poor people had no health insurance in 2001. They represented 30.7 percent of the poor, unchanged from 2000. (Robert J. Mills and Shailesh Bhandari, Ibid.)
  • Young adults (18-to-24 years old) remained the least likely of any age group to have health insurance in 2001. More than 28% of this group does not have coverage. (Robert J. Mills and Shailesh Bhandari, Ibid.)
  • Based on three year averages, American Indians and Alaska Natives were the least likely of the major racial groups to have health insurance. (Robert J. Mills and Shailesh Bhandari, Ibid.)
  • "Nearly 58% of currently unemployed adults and 21% of employed adults aged 18-64 had been uninsured for at least part of the past year, and one third of currently unemployed adults had been uninsured for more than a year.” (Robin A. Cohen and Hanyu Ni, “Health Insurance Coverage: Estimates from the National Health Interview Survey, January-June 2003,” National Center for Health Statistics, Centers for Disease Control, January 2004).
  • According to Ron Pollack, director of health care advocacy group FamiliesUSA, the Census Bureau underestimates the number of uninsured by measuring only those people without insurance at the time of the survey. Pollack estimated that if the report counted people who were uninsured for any part of 2001 or 2002, it would have demonstrated that “many more people are uninsured – 74.7 million over 2001 and 2002.” (“Census Bureau Numbers Too Low, Pollack Says,” Kaiser Daily Health Policy Report, 16 October 2003).
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Why is the number of uninsured people increasing?

  • “The number and percentage of people covered by employment-based health insurance dropped in 2003, from 61.3 percent to 60.4 percent, driving the overall decrease in health insurance coverage.” (Carmen DeNavas-Walt et al, Ibid.)
  • “Health insurance premiums are rising at their highest rate of increase since 1991. Real increases in health insurance premiums are associated with decreases in health coverage.” (Joel Miller, “A Perfect Storm” National Coalition on Health Care, November 2001)
  • “As costs rise and as coverage falls, more costs will be shifted to employers who currently provide coverage to pay the costs of care for the uninsured. Ultimately, those costs will be passed along to employees in the form of lower wage increases, reduced benefits, or higher out-of-pocket costs. This inequitable cost-shift will force more employers to drop or cut health insurance or go to defined contributions, and the erosion of the employment-based system will increase,” (Statement by Dr. Henry E. Simmons, President, National Coalition on Health Care, 2001)
  • “Insurance premiums jumped 15.5% this year for firms with fewer than 200 workers.” (Jim Hopkins, “Rising health costs take bite out of small biz,” USA Today, 6 October 2003).
  • “Baucus said only 7 percent of the unemployed can afford to pay for COBRA health insurance, the continuation of group coverage offered by their former employers. ‘That is not surprising,’ Baucus said. ‘Premiums for this coverage average almost $700 a month for family coverage and $250 for individual coverage, a very high price given the average $1,100 monthly unemployment check.’” (Mary Dalrymple, “Senators Seek Tax Credit for Unemployed,” Associated Press, 9 October 2003.)
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How does being uninsured harm individuals and families?

  • Uninsured U.S. children face a higher risk of developmental delays than those with health coverage (Hidden Costs, Value Lost: Uninsurance in America, Institutes of Medicine: National Academies Press, 2003)
  • The uninsured are more likely to seek care in health clinics and the emergency room than those with insurance. (“Access to Care for the Uninsured: An Update,” Kaiser Commission on Medicaid and the Uninsured, September 2003).
  • The uninsured are more likely to put off seeking care; to not receive care when needed; and to not fill a prescription or get a recommended treatment because of the expense. (“Access to Care for the Uninsured: An Update,” Ibid).
  • The uninsured are more likely to have problems paying their medical bills, change their way of life significantly to pay for medical bills, or to be contacted by a collection agency. (“Access to Care for the Uninsured: An Update,” Ibid).
  • The uninsured are more likely to be hospitalized for a preventable condition than the insured. (“Access to Care for the Uninsured: An Update,” Ibid).
  • Uninsured adults who have been hospitalized for heart attacks are over 25 percent more likely to die while in the hospital than privately insured adults. While the uninsured are just as likely to improve blood flow to their hearts in the acute stages of their heart attacks, they are less likely to undergo further costly diagnostic and therapeutic interventions. (“Access to Care for the Uninsured: An Update,” Ibid).
  • Uninsured adults hospitalized for a traumatic injury are more than twice as likely to die in the hospital as insured adults – even after controlling for the severity of the injury. (“Access to Care for the Uninsured: An Update,” Ibid).
  • Economist Helen Levy found that the diagnosis of a serious new health condition, including cancer, diabetes, heart attack, chronic lung disease, or stroke, reduced the wealth of uninsured households by 20 percent. Insured households in which a similar diagnosis was made suffered a 2 percent decline in their overall wealth. (“Helen Levy, “The Economic Consequences of Being Uninsured,” Economic Research Initiative on the Uninsured, ERIU Working Paper 12, October 2002).
  • Economist James Smith found that insured households paid an average of $26,957 in total medical spending after the diagnosis of a serious new health condition; uninsured households paid $42,166. (James Smith, “Healthy Bodies and Thick Wallets: The Dual Relation Between Health and Economic Status,” Journal of Economic Perspectives 13(2): 145-166. Quoted in Levy, Ibid).
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What costs are created by the uninsured population?

  • In 2001, the cost of medical care for uninsured residents totaled $98.9 billion. (“Hidden Costs, Value Lost: Uninsurance in America”, Ibid.)
  • United States spends about $35 billion per year to provide uninsured residents with medical care, often for preventable diseases or diseases that physicians could treat more efficiently with earlier diagnosis (Bloombert/Hartford Courant, 18 June 2003: “Hidden Costs, Value Lost: Uninsurance in America”, Ibid.)
  • The estimated 41 million U.S. residents who lack health insurance cost the United States between $65 billion and $130 billion per year in lost productivity (Institute of Medicine, Bloomberg/Hartford Courant reports, 18 June 2003)
  • Each uninsured U.S. resident loses between $1,645 and $3,280 per year in lost wages and benefits and in the value that improved quality of life and longer lifespan would provide. (Institute of Medicine, Bloomberg/Hartford Courant reports, 18 June 2003)
  • The cost of state health care programs “fall disproportionately on the local communities where care is provided.” (“Hidden Costs, Value Lost: Uninsurance in America”, Ibid.)
  • High rates of uninsured residents can affect the financial viability of providers in local communities and can result in reduced access to medical care. (“Hidden Costs, Value Lost: Uninsurance in America”, Ibid.)