Uninsured Boost Workers' Health Costs

Medical care for 48 million uninsured Americans is boosting average health insurance premiums by $922 per year for a family of four.

The figure, released Wednesday by the consumers' group Families USA, translates to roughly $300 in added medical premium costs for the typical working family, since employers usually pay approximately two-thirds of premiums for health coverage, experts say.

According to the report, about 48 million uninsured Americans are predicted to receive some $43 billion worth of what is known as "uncompensated health care" in 2005.

Read WebMD's "More Than 1 in 10 Lack Health Insurance"

Who Picks up the Tab?

Several taxpayer-funded programs, including Medicaid, reimburse hospitals and doctors for providing uncompensated care to uninsured patients. Those payments are due to reach more than $14 billion in spending funds this year, according to Kenneth Thorpe, a health economist at Emory University who conducted the analysis for Families USA.

But government programs pay for only part of the care. The rest of it is shouldered by health care providers, who typically raise prices paid by insurance companies. Those higher prices can be passed along to consumers in the form of higher premiums and other costs.

"It's a real haphazard way of paying for something that's so important as health care," Thorpe tells WebMD.

Six states had added costs that topped $1,500 per year for an average family of four. New Mexico had the highest added cost at $1,875 per year. Added costs are expected to near $3,200 per family by 2010, meaning that consumers in that state could be paying more than $1,000 in additional health insurance costs to cover the cost of the uninsured, according to the report.

For individuals, medical care for the uninsured is adding an average of $341 per year for single employer-sponsored coverage, it concludes.

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The View From Capitol Hill

"The growing problem of the uninsured is a problem that doesn't simply affect the uninsured themselves, but it affects all of us," Families USA president Ron Pollack tells WebMD. The group favors efforts to broadly expand access to health coverage.

Pollack says that policy makers in Washington should work to address the growing number of uninsured Americans "as soon as possible." But he also put the chances of action this year as "not high."

Sen. Gordon Smith (R-Ore.) says in a statement that expanding coverage for the uninsured "will help lower costs for everyone."

Congress has debated for years about how to make health insurance more affordable and expand access to coverage. President Bush has said he favors a system of tax credits providing money to buy coverage. But critics argue that such credits are too meager to purchase coverage that now often approaches $10,000 per year for a family of four, according to the Henry J. Kaiser Family Foundation.

Many Democrats favor using existing programs like Medicare and Medicaid to cover uninsured people, but Republican leaders strongly oppose expanding federal programs.

The years-long stalemate on Capitol Hill has instead pushed lawmakers to consider step-by-step approaches. Smith is soon to introduce a bill designed to cover high-cost, catastrophic care for uninsured people, according to spokesman Demetrios Karoutsos.

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By Todd Zwillich, reviewed by Michael W. Smith, MD

SOURCES: Families USA. Kenneth Thorpe, PhD, health economist, Emory University. Ron Pollack, president, Families USA. Henry J. Kaiser Family Foundation. Demetrios Karoutsos, spokesman, Sen. Gordon Smith (R-Ore.).