Families and the Work They Do Special Topic: Health Insurance

1. 10 Families and the Work They Do Special Topic: Health Insurance

2. An increasing number of families and individuals are losing their health insurance.(pp. 279-281) The problem has been exacerbated by the recession. Let’s examine the topic of health insurance: • How it works • What are the problems • What we are doing about these problems

3. How Do Most Americans Under Age 65 Obtain Health Insurance?

4. Employer-Sponsored Insurance History: • WWII: health insurance was a fringe benefit from large employers (>200 workers) • 1960s-70s: small & medium-sized employers (3-199 workers) also began to offer health insurance • 1980s: high costs caused small & medium employers to drop out • Today: less than 60% of small and medium employers offer insurance; large employers are cutting back on the scope of benefits (fewer covered services, more cost-sharing by employees)

5. Percent of Firms Offering Health Benefits, by Firm Size

6. Why This Strategy of Linking Employment with Insurance? By accident! Wage and price controls were in effect during WWII, so employers offered health insurance. But the relationship between employers and insurance has stuck and now is part of our culture. Other countries think that we are very odd!

7. Employer-sponsored Insurance is Now Subsidized by U.S. Tax System • Health insurance premiums are deducted before payroll taxes. • The self-employed can deduct all premium costs. • People with health expenses > 7.5% of income can deduct premiums on their tax returns.

8. But because of the cost, many small and medium size firms are backing out altogether, or forcing employees to pick up a larger share of the costs via higher premiums, deductibles, or co-payments.

9. Today Many PeopleAre Uninsured In 2009, 51 million Americans (17% of population; 19% of population under 65) lacked health insurance of any kind. • Primary reasons: (1) can’t get it through employer (2) too expensive to buy on their own ($14,000/family policy) (3) have a pre-existing condition and cannot buy it (4) unemployed (5) don’t fit into a specific government category (e.g., too young for Medicare, not poor enough for Medicaid, etc.)

10. Number of Uninsured Americans 2000-2009 (millions)

11. Who Are the Uninsured? It may surprise you.

12. Nearly 8 in 10 Uninsured Are in Working Families

13. Forty Percent of the Uninsured Livein Poverty (<100% FPL)

14. The Uninsured Span All Age Groups under Age 65

15. Consequences of Being Uninsured • Institute of Medicine report: • Each year, 18,000 people without insurance die unnecessarily. • The U.S. loses between $65 billion and $130 billion each year due to poor health and early deaths (lost productivity and medical expenditures).

16. Barriers to Health Careby Insurance Status Percent experiencing in last 12 months, 2009

17. How Do the Uninsured Pay for Care? 40% paid out-of-pocket themselves. 60% received some “uncompensated care” (about $50 billion), of which 80% is paid by government sources. • But increasingly, providers are not reimbursed with public dollars. As a result, providers are unwilling to care for the uninsured. • The uninsured are being asked to pay up-front before services are delivered.

18. Financial Consequences of Medical Bills by Insurance Status, 2010

19. Being uninsured can pull a family into poverty, cause the family’s home to go into foreclosure, and result in serious debt.

20. What Should We Do about the Growing Problem of the Uninsured? The answer to this question has become very politicized. A few years ago, most people wanted some type of health reform.

21. Percent Who Thinkthe Government Should…? (2006)

22. Gov’t Passed Health Reform in 2010 (which will be phased in by 2014) Some key features: • Most people will be required to buy health insurance. • People who cannot afford it will receive financial assistance. • Employers will be required to offer insurance or pay a penalty. • New regulations will help prevent insurers from denying coverage to people, or charging extra for pre-existing conditions. • Medicaid will be expanding to 133% of federal poverty line. • Young adults can stay on parents’ policy until age 26.

23. Although people liked these ideas five years ago, today many do not like them or are unsure.

25. Why the change of heart? Politics!

27. References ABC News/Kaiser Family Foundation/USA Today. 2006. Health Care in America Survey (September 7-12, 2006). DeNavas-Walt, C, Proctor, B.D., and Smith, J.C. 2010. Income, Poverty, and Health Insurance Coverage in the U.S., 2009. U.S. Census Bureau, Current Population Report P60-238. US Government Printing Office. Online: http://www.census.gov/prod/2010pubs/p60-238.pdf Kaiser Family Foundation. April 2011. Health Reform Source. Online: http://healthreform.kff.org Kaiser Family Foundation. March 2011. Kaiser Health Tracking Poll. Online: http://www.kff.org/kaiserpolls/upload/8166-F.pdf Kaiser Family Foundation. December 2010. The Uninsured: A Primer. Online: http://www.kff.org/uninsured/upload/7451-06.pdf Kaiser Family Foundation. September 2010 The Uninsured and the Difference Health Insurance Makes. Online: http://www.kff.org/uninsured/upload/1420-12.pdf Kaiser Family Foundation. 2010. Employer Health Benefits. Online: http://ehbs.kff.org/pdf/2010/8086.pdf