Insurance up, uninsured up, health-insurance premiums increase faster than inflation and more people are left without any coverage at all

Editorial in The Greenville News

September 29, 2006

Health-insurance premiums continue to rise twice as fast as overall inflation and wages. The results will be entirely predictable: Workers will struggle harder to pay for health-care coverage. More employers — especially small businesses — will drop health-care coverage completely. More individuals will join the ranks of the uninsured.

Some elected officials often act as if nothing can be done to stem the rising cost of health care and the increasing number of uninsured Americans. But doing nothing is no longer acceptable.

The average cost of employee health insurance rose 7.7 percent this year to $11,481 for the average family, according to the Kaiser Family Foundation and the Health Research and Educational Trust. The average worker’s share of that cost is $2,973, and the employer’s share is $8,508. Single coverage is $4,242, of which workers pay $627. The good news is that the 7.7 percent increase for 2006 was the smallest since 2000. But workers’ earnings increased only 3.8 percent while overall inflation, up 3.5 percent, ate up most of that increase.

The same holds true over the past several years. Average wages have increased 20 percent since 2000, but overall inflation, up 18 percent, consumed most of those raises. Meanwhile, health-care coverage has risen 84 percent since 2000. Politicians who wonder why Americans aren’t giddy about current strong economic growth should consider those burdens on the family pocketbook.

In addition, the ranks of the uninsured continue to grow. About 46.6 million Americans, including 40,000 Greenville County residents, were uninsured in 2005. Those figures imply a lot of suffering in the richest nation on the planet.

What can be done? No solution will be easy, but politicians can’t simply ignore these spiraling costs. President Bush and Sen. Jim DeMint have touted health savings accounts as one answer. Certainly health savings accounts, coupled with high-deductible insurance, lowers premiums for workers and employers. But Bush and DeMint have failed so far to convince Americans that health savings accounts are the way to go. The number of Americans with health savings accounts stood at 4 percent — a rate about the same as last year.

Gov. Mark Sanford also touts health savings accounts as a way of helping businesses afford health insurance, but small businesses here continue to dump health coverage. South Carolina is one of only eight states where the uninsured rate rose last year. A promising initiative in this state has some employers teaming up directly with community health centers, bypassing insurance, to make primary care affordable.

Increasing South Carolina’s pitifully low cigarette tax could provide money to insure more children and to help small businesses provide insurance for their workers. We could learn also from other states. Some states also are considering backstopping private insurers — reimbursing insurers when the bills generated by a patient rise above, say, $50,000 in one year. That would help bring down the cost of premiums. Massachusetts and Vermont, meanwhile, have taken different routes toward trying to insure everyone in those states.

In this election year, candidates should be pressed for solutions to the high cost of health insurance and the growth in the number of uninsured Americans. It’s unacceptable for a candidate to have no plan at all.

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