Washington, D.C.—A report released today by the consumer health organization Families USA spotlights a growing crisis among insured families, as rising health care costs devour a growing portion of their pre-tax income.
In the United States, 64.4 million people under age 65 are in families that will spend more than 10 percent of their pre-tax family income on health care in 2009, and 82.6 percent of those people are insured—an increase of 22.7 million such people since 2000.
In Arkansas alone, 709,000 people under age 65 are in families that will spend more than 10 percent of their pre-tax family income on health care in 2009, and 82.5 percent of those Arkansas families have insurance. In addition, there are 238,000 Arkansans in families that will spend more than 25 percent of their pre-tax income on health care in 2009.
“As our findings make clear, high health care costs are not just a problem of the uninsured,” Ron Pollack, Executive Director of Families USA, said today. “More and more families with insurance are affected by rising health care costs, and, for many, the burden of these costs is becoming too great to bear.”
That this problem is affecting more and more families is an essential element of this 2009 report, an update of a 2007 Families USA report that was the first of its kind to document these costs on a state-specific basis. The report shows that the number of insured people in families paying 10 or 25 percent of their pre-tax income on health care has climbed dramatically in Arkansas, a symptom of the runaway costs plaguing the U.S. health care system.
The report reveals:
• 709,000 non-elderly Arkansans 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 270,000, or 61.4 percent.
• More than four out of five people (82.6 percent) in families spending more than 10 percent of their pre-tax income on health care are insured.
• 585,000 non-elderly Arkansans 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:
• 238,000 Arkansans 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 97,000, or 68.8 percent.
• More than 3 out of 4 people (76.9 percent) in families spending more than 25 percent of their pre-tax income on health care are insured.
• 183,000 Arkansans with insurance are in families that will spend more than 25 percent of their pre-tax income on health care in 2009.
As the Families USA report demonstrates, hundreds of thousands of Arkansans are in families that face high health care costs. A number of factors have driven this phenomenon. First and foremost, health insurance premiums are increasing. As premiums rise, employers are forced to make tough decisions, particularly in this recession, about the coverage they offer to their employees. Some drop coverage, others increase the share of the premium that employees must pay, and more offer insurance that covers fewer services and/or requires high out-of-pocket costs. As a result, Arkansas families must shoulder a greater portion of health care costs.
“Arkansas families are hit hard in the wallet because of skyrocketing health costs,” Pollack said. “As a result, Arkansans are spending much larger portions of their family incomes on health care—and health care is becoming less and less affordable.
“The growing burden of health care costs on Arkansas families is a clear signal that health care reform is overdue,” Pollack said.
"These figures demonstrate just how interconnected health care is with our nation's long-term economic sustainability," said U.S. Representative Mike Ross. "Forty percent of every tax dollar paid today goes to fund Medicare, Medicaid or Social Security, and by the year 2040, that number will reach 100 percent if we do nothing. Arkansas's working families are struggling because health insurance premiums are rising six to eight times faster than wages. We must make health care affordable, accessible, and adequate for every working American, especially those in rural areas. Then, and only then, can we get the skyrocketing costs of health care under control and stabilize our national economy."
