Health care out of reach for many

By Sarah E. Moran
Published: September 26, 2008

Health care premiums for Pennsylvania workers increased more than six times faster than their earnings from 2000 through 2007, a new report revealed Thursday.

During those eight years, according to Families USA, a Washington, D.C. health care advocacy group, family health care premiums in the state rose by 86.2 percent, to $12,513 annually, while median yearly earnings increased just 13.4 percent, to $28,155.

The report focused on the health insurance premiums that Pennsylvania workers and their employers pay when businesses offer health care insurance coverage — a number that in itself is diminishing, according to Ron Pollack, Families USA executive director.

"Skyrocketing health care costs were a problem in Pennsylvania before the current economic downturn, and slow wage growth or job losses now only make matters worse," he said in a Thursday conference call with reporters.

A family of four in 2007 paid an average of $2,953 per year for health care coverage, an increase of almost 128 percent from 2000. Employers, meanwhile, paid $3,063 annually per employee, a 76.3 percent boost since 2000, Families USA research found.

It will come as no surprise to most people who participate in workplace health insurance plans that, as premiums keep escalating, coverage is thinning via fewer benefits plus higher deductibles and co-payments.

The situation at the Greater West Chester Chamber of Commerce is a case in point.

One-quarter of the chamber's 800 members offer health insurance to employees via a chamber-sponsored program intended to keep premiums reasonable

with economy of scale, explained Katie Walker, chamber president.

"Premiums for employers and employees alike are always going up," said Walker, though the Henry J. Kaiser Family Foundation found in a new survey that employer/employee costs increased a relatively modest 5 percent this year after a decade of double-digit increases.

Last year, Walker said, the chamber and its four full-time chamber employees "couldn't handle a proposed premium increase so we worked with our provider to keep them the same."

Out-of-pocket costs remained constant but coverage decreased in some areas.

Walker pays 25 percent of her annual premium; the chamber picks up the rest. Employees' dependents can be covered by the chamber plan too but the employee must shoulder the entire expense, Walker explained — an increasingly common scenario in an era of paying more for less.

"We're seeing an increased number of under-insured and uninsured people who are employed," said Pamela G. Bryer, executive director of the Maternal and Child Health Consortium, which coordinates Chester County initiatives to enroll uninsured women and children in state and federal health insurance programs such as CHIP and Medicaid.

"And more and more people who have health insurance don't use it because deductibles and co-pays are so high."

The U.S. Census Bureau found that 71 percent of uninsured people nationwide are employed, be it full- or part-time, said John Dodds, executive director of the Pennsylvania Unemployment Project, a Philadelphia-based organization of low-paid workers and the unemployed. "Many employers cut out health care coverage entirely when they need to curb costs to remain solvent," he added.

Chester County has 14,280 uninsured people, 3,200 of those in the Coatesville area, according to the Community Health Data Base. The ranks of the under-insured is "much more slippery," Bryer noted, because the definition of under-insured varies so much from patients and medical conditions alike.

Pennsylvania has 1.2 million uninsured residents under the age of 65, Families USA's Pollack asserted — 11.3 percent of the state's non-elderly population.

"As health care becomes less and less affordable, Pennsylvanians face difficult choices in trying to provide health coverage for themselves and their families," Pollack said. "A bad situation is clearly growing worse."