As we approach the new year, a number of Americans across the U.S. are worrying a “great deal” about health insurance – 55 percent to be exact – according to a recent Gallup poll. The U.S. has poorer health outcomes despite spending nearly twice as much as other high-income countries, ranking it the worst out of the 11 developed nations. [1] In 2016, the U.S. spent nearly 18 percent of its gross domestic product (GDP) on healthcare, while other countries spent as low 9.6 percent. Much of the cost can be attributed to U.S. prices of labor and goods, which include administrative costs, pharmaceuticals, and devices. [2] Accessibility for coverage has long been a concern, but the financial cost of paying for health insurance is becoming an increasingly bigger burden to carry.
Chief Executive of the Kaiser Family Foundation, Drew Altman, stated, “for some reason, we like to focus on coverage when the issue for workers, people, and the public generally is cost.” [3] A 2018 poll found that 61 percent of those surveyed considered an increase in premium one of most concerning in four potential setbacks, while 46 percent worried about not having enough money to pay for their coverage.
Overall, private insurance covers about 67 percent of the total insured while nearly 34 percent are covered through a public plan. [4] Employer sponsored health insurance remains the most common for those who have coverage, insuring more than 153 million Americans. Unfortunately, the rates of premiums and deductibles prevent some people from seeking or having any type of coverage. Some workers who are eligible for benefits refrain from enrolling in a plan because they felt it would be too expensive or they already had other coverage. [5] In other cases, people have gone as far as quitting their jobs because their plan was deducting too much out of their paycheck. [6]
Check out the Kaiser Family Foundation 2019 annual survey to find more information on employer health benefits.
The high costs of premiums and deductibles have caused an estimated 87 million adults ages 19 to 64 to be inadequately insured, according to the Commonwealth Fund. The organization considers underinsured individuals to fall into one of three separate categories: out-of-pocket costs, excluding premiums, over the prior 12 months are equal to 10 percent or more of household income; out-of-pocket costs, excluding premiums, over the prior 12 months are equal to 5 percent or more of household income for individuals living under 200 percent of the federal poverty level ($24,120 for an individual or $49,200 for a family of four); or the individual’s deductible constitutes 5 percent or more of household income. [7]
While cost continues to be the primary concern, millions throughout the U.S. lack coverage. The enactment of the Affordable Care Act (ACA) helped more than 20 million uninsured Americans gain coverage between 2010 to 2017, but its future and coverage for those millions of Americans hangs in the balance. In the court case Texas v. United States, a federal district court found the ACA to be unconstitutional. If upheld, this could add to the 28 million Americans who are still uninsured – equivalent to about 8.5 percent of the U.S. population.
Detailed information on health coverage among the US population can be found in the US Census Bureau’s 2019 report, ‘Health Insurance Coverage in the United States: 2018.’
For the uninsured population, an estimated 76 percent postpone and do not seek medical care because of the cost, often resorting to over the counter medications or home remedies. Consequently, one in four reported their condition worsening because they waited too long to seek medical attention or because they used an alternative treatment. [8] The two largest groups of the uninsured population were adults ages 26-34 and 35-55. Additionally, most people without coverage did not complete more than a high school education with those who did not complete high school making up a larger percentage of the uninsured population. The uninsured population was also reported to be more likely living in poverty. [9]
In Texas, about 18 percent of the state lacks health coverage. With about 5 million people lacking coverage, it is the most uninsured state in the country. Under the ACA, states could have expanded Medicaid, which would have drawn down $9 of federal funding for every $1 the state spent. In Texas, more than a million Texans would have gained coverage, more than $100 billion federal dollars would have been drawn down expanding the Texas economy, and the new economic activity would have generated new state tax revenues more than offsetting any state expense. Texas remains one of the 14 states in the country that decided not to expand.
Last year, Georgetown University reported that Texas also had the largest number of children without health insurance, totaling up to 835,000 children without coverage.[11] Having so many uninsured parents means many children eligible for health insurance under Medicaid or CHIP go unenrolled because families aren’t informed about existing options. Additionally, regulatory barriers complicate enrollment for parents. Texas requires parents to re-enroll each child every six months. Legislation to provide for continuous enrollment for children for a full year has failed, as has legislation to synchronize re-enrollment for families with multiple children.
If Texas does not address the current system, the number of uninsured will rise to more than 6 million by 2040. The state is also predicted to see a loss of $178.5 billion dollars as a result of lost earnings and the value of poor health. Additionally, Texas leads the nation in rural hospital closures with 26 closing due to financial pressures since 2010. Making the problem worse, a federal waiver known as the “1115 waiver,” which reimburses hospitals for uncompensated care, is set to expire in 2021. The quality of individuals’ lives, and the health care system that serves them, are essential to labor productivity, business profitability, household financial stability, and future earnings. Texas faces a number of imminent policy decisions that will determine our state’s economic future.
[1] https://www.reuters.com/article/us-health-spending-idUSKCN1GP2YN
[2] Papanicolas I, Woskie LR, Jha AK. Health Care Spending in the United States and Other High-Income Countries. JAMA. 2018;319(10):1024–1039. doi:https://doi-org.ezproxy.lib.utexas.edu/10.1001/jama.2018.1150
[3] https://www.nytimes.com/2019/09/25/health/employer-health-insurance-cost.html
[4] https://www.census.gov/library/publications/2019/demo/p60-267.html
[5] http://files.kff.org/attachment/Report-Employer-Health-Benefits-Annual-Survey-2019
[6] https://www.nytimes.com/2019/09/25/health/employer-health-insurance-cost.html
[7] https://www.commonwealthfund.org/publications/issue-briefs/2019/feb/health-insurance-coverage-eight-years-after-aca
[8] https://www.kff.org/health-costs/issue-brief/data-note-americans-challenges-health-care-costs/
[10] https://www.texastribune.org/2019/09/10/texas-has-most-people-without-health-insurance-nation-again/