Washington, D.C. – Health care premiums rose an estimated 2.3 times faster than earnings for the District of Columbia’s working families from 2000 to 2006, according to a report issued today by the consumer health organization Families USA. In that six-year period, health care premiums rose by 60.6 percent, while median earnings rose by only 26.8 percent.
The Families USA report is the first of its kind to document these changes on a state-specific basis. Among the key findings in the report are:
• For family health coverage provided through the workplace in the District of Columbia, annual health insurance premiums in the 2000-2006 period rose from $8,335 to $13,388, an increase of $5,053, or 60.6 percent.
• Between 2000 and 2006, the median earnings of the District of Columbia’s workers increased from $30,663 to $38,888, or 26.8 percent.
According to the report, the disproportionately high increases in insurance premiums occurred despite the provision of “thinner coverage” to workers—coverage that offers fewer benefits and/or that comes with higher deductibles, copayments, and co-insurance. As a result, the District of Columbia’s families are paying more but receiving less health care coverage.
The Families USA report concludes that the confluence of higher health costs and stagnant wages is causing a growing number of the District of Columbia families to join the ranks of the uninsured and underinsured. The number of non-elderly uninsured people in the District of Columbia is more than 71,000, approximately 14.8 percent of the non-elderly population.
“District of Columbia families have been hit hard in the pocketbooks due to skyrocketing health costs and stagnant wages,” said Ron Pollack, Executive Director of Families USA. “As a result, D.C. residents are paying much larger portions of their paychecks on health care – and health care is becoming less and less affordable.”
The key findings in the report provide data concerning premiums for family health coverage as well as individual coverage. They also break out the premium costs paid by employers and those paid by employees. The key findings include:
• For family health coverage in the District of Columbia, the employer’s portion of annual premiums in the 2000-2006 period rose from $6,370 to $10,362, an increase of 62.7 percent.
• For family health coverage, the worker’s portion of annual premiums rose from $1,965 to $3,026, an increase of 53.9 percent.
• For individual health coverage, the employer’s portion of annual premiums rose from $2,283 to $4,292, an increase of 88.0 percent.
• For individual health coverage, the worker’s portion of annual premiums rose from $445 to $757, an increase of 70.3 percent.
According to the report, these fast-rising health care costs are causing increasing numbers of people to go into debt. The report cites a study that found that more than half of bankruptcies are now due, at least in part, to problems with medical costs.
“If this troubling trend continues, the health care affordability crisis will get much worse and many more D.C. residents will become uninsured and underinsured,” said Pollack. “If earnings continue to lag behind fast-rising health care costs, residents of the District of Columbia will face diminishing economic and health security. It is high time for national leaders to address this growing problem and make it a top national priority.”
The Families USA report is based on data from the U.S. Census Bureau, the U.S. Department of Labor, and the U.S. Department of Health and Human Services.
