A Report from Familes USA, April 2009
Too Great a Burden:
Americans Face Rising Health Care Costs
INTRODUCTION
Long before the current economic crisis began, Americans were already straining under the burden of two related trends: shrinking coverage and rising health care costs. Over the last decade, millions of Americans have joined the ranks of the uninsured, and millions more have become underinsured as the value of their coverage has declined. At the same time, health insurance premiums and out-of-pocket costs have risen steadily, and the number of families who are facing unmanageably high health care costs has grown. Left unchecked, health care costs will keep going up, forcing more and more American families into debt—and even into bankruptcy and foreclosure.
To better understand the magnitude of the health care cost crisis, Families USA commissioned The Lewin Group to analyze data from the U.S. Department of Health and Human Services and the U.S. Census Bureau that reveal how many Americans face very high health care costs. This analysis allowed us to determine how many non-elderly people are in families that will spend more than 10 percent of their pre-tax income, and more than 25 percent of their pre-tax income, on health care in 2009.
Our analysis paints a stark picture: Nearly one in four Americans under the age of 65—some 64.4 million people—will spend more than 10 percent of their family income on health care in 2009. The vast majority of these people (82.6 percent) have health insurance. And 18.7 million non-elderly Americans—more than three-quarters of whom have health insurance—are in families that will spend more than 25 percent of their income on health care in 2009.
This analysis also reveals the rapid growth in the number of people in families with high health care costs over the last nine years. From 2000 to 2009, the number of people in families that spend more than 10 percent of their income on health care will increase by nearly 22.7 million (54.4 percent). Over that same period, the number of people in families that spend more than 25 percent of their income on health care will increase by nearly 7.1 million (60.6 percent).
With the economy faltering and unemployment at its highest rate in decades, millions of Americans are at risk of losing their jobs and, consequently, their health insurance. Many others still have health insurance, but reductions in that coverage are leaving them exposed to higher out-of-pocket costs. For a growing number of Americans, health care costs are truly too great a burden. The need to secure true health reform has never been more urgent: The economic security of American families lies in the balance.
