Uninsured on the Ropes Fastest Growing Group Making $25,000- $50,000; Many Start-Ups Can't Afford Benefits Yet
Comerford, Mike, Daily Herald (Arlington Heights, IL)
Amid the longest economic boom in U.S. history, the number of uninsured workers is on the rise and the new uninsured are breaking old stereotypes.
The problem, observers say, is being exacerbated by the dynamics of the so-called new economy.
The fastest-growing group of the new uninsured are in households making between $25,000 and $50,000 a year. This group of moderate income workers without insurance has increased nearly 70 percent between 1996 and 1998, according to a study by Brandeis University.
"People think because the economy is great that everybody is doing great but that isn't the case anymore," said state Sen. David Sullivan, a Republican from Park Ridge, who is supporting community outreach initiatives for the uninsured.
The new economy has created wealth and jobs, but analysts point out that many of the jobs are in start-ups that can't yet afford full benefits.
"All the job growth in this economy is in small businesses," said Truman "Rick" Cobb, vice president of Challenger, Gray & Christmas, a Chicago-based employment consulting firm. "Companies at that size don't have the dollars or the leverage to offer insurance and other benefits."
Nearly half of the adult uninsured work full time, year-round, according to statistics supplied by United Power for Action and Justice, a Chicago-area labor advocacy group. The number of working uninsured has grown 42 percent since 1996, to 590,000 people in Illinois.
"It isn't just a problem for the working poor or minorities," said Joshua Hoyt, a spokesman for United Power. "Yes there are uninsured blacks and Mexicans. But there are also uninsured people who have been downsized. Uninsured college graduates. Uninsured people making $25,000 to $50,000 a year."
Another fallout of this economy, according to Hoyt, is the record number of layoffs at large corporations. While unemployment hovers around historic lows, it co-exists with rapid and more- frequent restructurings at large companies.
The hardest hit by such downsizing are typically people between 55 and 64 years of age. At that age it is difficult, Hoyt added, to find a job with comparable pay and benefits, including insurance. Many of them can afford insurance, he said, but don't qualify for many plans and go for months and years at a time without insurance as a result.
Across the country, estimates indicate that about 44 million people have no health insurance. According to a soon-to-be released study by the Schaumburg-based Society of Actuaries, that figure will grow to 55 million uninsured by 2008, assuming the economy continues to grow as it has in recent years. Should an economic downturn hit the economy before then, the number of uninsured could grow to 60 million, or nearly a quarter of all the non-elderly in the country.
"I think it is a combination of three new factors," said Bill Pierce, a spokesman for Blue Cross & Blue Shield Association. "Welfare laws have changed. Healthcare costs are rising. And there are a rising number of small businesses that can't yet offer a full set of benefits."
However, while the economy has led to more working uninsured, there are also signs that it is creating pressures to turn that trend around.
Record low unemployment is giving workers a better hand for gaining benefits.
Such is the case with the suburban chapter of the Service Employees International Union. Representing 4,500 janitors working in commercial office buildings in the suburbs, the union is negotiating for health insurance benefits along with a pay increase. …