Healthcare 'Crisis' Grows for Middle Class ; Rising Jobless Rate Leads to More Uninsured, Prompting Congress and White House to Seek Ways to Widen Coverage

Article excerpt

More than 2 million Americans lost their health insurance when they lost their jobs during the past year.

That's more than at any time since 1992 and brings the total number of people without coverage to more than 41 million. That number exceeds the aggregate populations of 23 states plus the District of Columbia.

True, the number of uninsured tends to spike during economic hard times. But the problem has been exacerbated by healthcare costs, which are now rising at five times the rate of inflation. As a result, experts predict that even more employers - who provide most Americans with their insurance - will continue to cut back coverage, if not eliminate it altogether.

"This is the top health problem in the United States, and it's the issue of conscience in the American healthcare system," says Ron Pollack, the executive director of Families USA, a nonpartisan healthcare advocacy group in Washington.

But as the problem grows to what many perceive as crisis proportions in America's middle class - the vast majority of the uninsured are working people - so, too, does hope that after a more than a decade of failed proposals and fierce turf battles, Congress may find a workable compromise.

In their budget proposals, both the White House and the Senate have earmarked more than $90 billion over 10 years to expand health- insurance coverage. While there's no consensus on how to spend it, there is broad agreement, particularly among the major stakeholders in the healthcare system - from doctors to hospitals to health- insurance companies - that something must be done, and soon, to prevent an even greater healthcare crisis.

Employers ready for change

The business community is on board as well. As the number of uninsured grows, the problem feeds the already-spiraling costs that companies face in insuring workers.

"Employers see health coverage as vital to having a productive workforce, but it's becoming more and more difficult to provide," says Kate Sullivan, director of healthcare policy for the US Chamber of Commerce. "Many are seeing their health insurance premiums go up between 25 and 40 percent for the third and fourth years in a row."

To understand the complex relationship between the number of uninsured and overall healthcare costs, it helps to think of the American healthcare system as one of Rube Goldberg's complex machines - where one push of a button can set off a whole series of unexpected events. For instance, when a person loses health coverage, it has an indirect but very real impact on the ability of almost all businesses to provide coverage.

Studies have shown that the uninsured tend to delay care for what doctors would consider small problems until they reach crisis proportions. Then they go to the emergency room, which is the most expensive and inefficient place to get healthcare. Because the uninsured often can't afford to pay the cost of the care, it becomes what's called "bad debt." Hospitals simply have to absorb those costs, and they often do it by increasing what they charge for the services to people who do have insurance.

That's called "cost shifting" in the trade, and it, in turn, feeds the spiraling insurance costs, which make it more difficult for employers to provide health insurance - which ultimately increases the number of people who are uninsured. …


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