MONEY & MEDICAL CARE : Where Resources & Needs Conflict

Article excerpt

There is a morbid race going on in health policy in the United States-a game of "chicken." The question is, what will force us to confront our limited health-care resources first: the demographic bubble of aging baby boomers who will break the Medicare bank or the growing number of people with no health insurance?

As Americans, we appear to want all to get all the medical care they need. While we set up public insurance for the most vulnerable-Medicare for the elderly and Medicaid for poor women and children-we don't have faith in the government to pull it off for all of us. So we rely on privately financed health insurance and we subsidize free or reduced-cost care for those who cannot afford it.

These efforts, though, have never been enough. Good medical treatment does not exist without a steady way to pay for it. People without health insurance postpone needed preventive care and medical treatment (over half of all adults without health insurance have no regular source of care), and as a result have poorer health. Community health centers-the traditional free clinics-have always struggled to meet great demand with limited funding. Hospital emergency departments have become triage centers for uninsured people who show up for nonemergency care, knowing that while they will have to wait, they will not be turned away. Treatment and follow-up care for an uninsured person can vary dramatically from what an insured person with the same condition receives, and, finally, medical-care debts can saddle patients for years after treatment.

Get a job

Historically, the uninsured were usually the unemployed. Get a job and you'd get your health insurance. Good labor policy was good health policy. But that strong connection between employment and health coverage is weakening. The number of uninsured continues to rise even as unemployment rates drop to theoretical lows. And the uninsured find that their health costs are rising at a time when there are fewer subsidies available to treat them. What happened to the deal that a job meant health insurance? How did we get here and how do we get out?

Some figures. From 1987 to 1996 the number of people under the age of sixty-five without health insurance rose by 10 million, to more than 41 million. Moreover, in the last two years, one in every three people experienced a break in health insurance coverage, and that break was usually for longer than a year's time. Who are the people without health insurance? Most are adults and most are not poor (80 percent of the uninsured have family incomes above the poverty level, and almost half of them are from families with incomes twice the poverty level). They are disproportionately nonwhite (even accounting for age, work status, and income). Most significant, more and more are employed. There are 22 million workers-17 percent of the workforce-without health insurance. Fifty percent of people without health insurance are from families with a full-time worker; another 25 percent are from families with a part-time or part-year worker.

What has happened to employment-based health insurance? From 1987 to 1995, in a period of economic expansion, the proportion of Americans with workplace health coverage dropped 5 percentage points. Why the decline? Two reasons: We began making fundamentally different kinds of jobs; and our health-care costs went through the roof.

* Different jobs. Compared to earlier periods of employment growth, our new jobs were more likely to be in smaller businesses, nonunionized industries, temporary employment, or the service sector. Historically these sectors have been less likely to provide health insurance to their employees. Moreover, they produce lower-wage jobs, which means employees are less likely to be able to afford to pay their share of a health- insurance premium.

* Rising costs. The annual rate of health-care inflation has averaged just under twice the general rate of inflation for the past ten years, and is accelerating rapidly. …