Report Documents Escalating Health Care Costs For Underinsured

May 12, 2009

    Washington, D.C. -  As Congress works on comprehensive health care reform a new report documents the growing burden of medical care for the underinsured - those with coverage that doesn′t keep pace with deductibles, co-pays and treatment excluded by insurance, including pre-existing conditions.

    Families USA, a national organization advocating for health care reform, issued a report on Tuesday entitled "Too Great A Burden," showing that approximately 1.5 million people in New Jersey under the age of 65 will spend at least 10 percent of their gross income on health care in 2009. Of those, close to 364,000 people will spend at least 25 percent of their total earnings on health care.

    Among both groups, about 80 percent have insurance.

    "This is a crisis for the underinsured as well as for those without insurance coverage," said Pallone. "It′s a false comfort to have insurance if it doesn′t cover needed treatment, especially for those who find out what their out-of-pocket expenses will be when they go for medical care."
    Nationally, approximately 64.4 million people under the age of 65 - one in four Americans - will spend more than 10 percent of their family income on health care in 2009.

    "What is frightening about this trend is the number of people who have insurance who have to spend larger amounts of their income or, in the worst circumstances, get forced into bankruptcy in order to pay for needed treatment," said Pallone. "It is clear from this report that the trend is getting worse. In the past nine years, the number of people in New Jersey spending more than 10 percent of their income on health care increased by 438,000."

    Pallone, who is helping spearhead reform efforts in Congress, said these figures underscore the importance of delivering reforms this year.

    "President Obama is right when he says we can′t afford to put this off any longer," said Pallone. "The economy can′t afford to wait and American families can′t afford to wait. This is a crisis with expensive price tag."

    The United States spends more than $2.2 trillion a year on medical care.
 
Other findings from the report:

• 1,465,000 non-elderly New Jerseyans are in families that will spend more than 10 percent of their pre-tax income on health care in 2009.
• Between 2000 and 2009, the number of people in families spending more than 10 percent of their pre-tax income on health care will have increased by 438,000. This increase is greater than the population of (city), and is a 42.7 percent increase from 2000.
• More than eight out of ten people (80.2 percent) in families spending more than 10 percent of their pre-tax income on health care are insured.
• 1,175,000 non-elderly New Jerseyans with insurance are in families that will spend more than 10 percent of their pre-tax income on health care in 2009.

The report also looks at the number of people in families that spend more than 25 percent of their pre-tax income on health care costs:

• 364,000 New Jerseyans are in families that will spend more than 25 percent of their pre-tax income on health care in 2009.
• Between 2000 and 2009, the number of people in families spending more than 25 percent of their pre-tax income on health care will have increased by 109,000.
• More than seven out of ten people (71.4 percent) in families spending more than 25 percent of their pre-tax income on health care are insured.
• 260,000 New Jerseyans with insurance are in families that will spend more than 25 percent of their pre-tax income on health care in 2009.

To see the Families USA report: http://www.familiesusa.org/assets/pdfs/too-great-a-burden-2009.pdf