A key way to judge the effectiveness of a nation’s health care system is to evaluate what percentage of the populace the system covers. The health care reform legislation passed by the Democratic Congress and signed into law by President Obama goes a long way toward improving America’s standing on that factor by expanding health insurance coverage to 32 million more Americans.
As Winning Progressive previously explained, a major inadequacy in the pre-reform health care system is that, despite spending more on health care than any other country on the planet, the U.S. has by far the highest percentage of people who lack coverage. In 2000, there were 39.2 million uninsured Americans. By 2009, that number had increased to 50 million, which is approximately 16% of the American population. Much of the decline in coverage is because fewer employers are covering their employees. In 2000, 66% of employers provided coverage, but by 2009 that number was down to 58.9%. 28 million of the uninsured are small business owners, their families, and their employees.
The health and economic impacts of such high rates of uninsured are staggering. A recent study from Harvard Medical School found that as many as 45,000 Americans die every year due to a lack of health insurance. People who lack health insurance receive less preventative care, are diagnosed at later stages of a disease, and once diagnosed receive less therapeutic care and have higher mortality rates. In 2004, the American College of Physicians estimates that the society-wide economic value of the decline in health and longevity individuals suffer for each year without health insurance is between $65 billion and $130 billion per year. The uninsured do receive some health care – mainly through emergency rooms – and approximately $40 billion of that care is uncompensated, meaning the cost is picked up by either the government or the hospitals and doctors that provide it.
President Obama’s health care reform legislation seeks to drastically reduce the number of uninsured by expanding employer coverage and Medicaid, and by making sure that individuals who need to purchase health insurance are able to afford it:
- Encouraging Employer Coverage: The legislation works to encourage employers to provide coverage to their employees. For small businesses with fewer than 50 employees, an up to 50% tax credit is provided if the company pays for at least 50% of their employees’ health insurance premiums. Larger businesses are required to either provide their employees with health insurance, or to pay a $2,000 per year assessment for any employee that receives a tax credit for purchasing insurance on their own.
- Shared Responsibility: As the necessary accompaniment to ending pre-existing condition exclusions, the health care reform legislation requires individuals to have health insurance. Without such requirement, the pre-existing condition prohibition would be unworkable, as people would simply wait to purchase insurance until they have a major illness.
- Making Insurance Affordable: The legislation provides sliding scale tax credits to people earning up to approximately $88,000 for a family of four, or $40,000 for an individual, in order to limit spending on health insurance premiums to between 2 and 9.5% of income. The legislation also limits total out-of-pocket expenses to between $2,000 and $6,000 for an individual, and between $4,000 and $12,000 for a family of four.
- Creating a Fairer Insurance Market: Individuals and small businesses will be able to purchase insurance through state or national health insurance exchanges, in which it will be easy to make side-by-side comparison of the insurance options available. The exchanges will be overseen by the federal Office of Personnel Management and/or state-based non-profits to ensure fairness and transparency. This is the same approach to health insurance as is provided by the extremely popular federal employee health insurance program.
- Expanding Medicaid: The legislation expands Medicaid to make eligible anyone whose annual income is within 133% of the federal poverty level.
A recent analysis by the Rand Institute, a non-partisan think tank, published in the New England Journal of Medicine, projected that the health care reform legislation will succeed in expanding coverage and making health insurance coverage more affordable.
Do you support President Obama and the Congressional Democrats’ efforts to make health insurance more affordable and to cover an additional 32 million Americans? If so, write a letter to your local newspaper editor to let them know