Paying More and Getting Less

The 47 million uninsured Americans have often been at the center of the debate on health care reform. Less often talked about are the approximately 25 million underinsured Americans who have insurance with very limited coverage and spend a large share of their income on medical expenses. In 2008, an alarming 1.6 million Texans spent more than 25 percent of their income on health related costs, while another 5.3 million spent more than 10 percent.

A lack of adequate insurance coverage affects Americans at every income level, not just low-income individuals. Many Americans with insurance pay high deductibles, high out-of-pocket costs, and have annual and lifetime limits on health benefits. This problem has been exasperated by the current economic climate and rapidly increasing health care costs. More employers are no longer offering health coverage and many are changing to plans that offer less adequate benefits and require workers to pay more in costs.

Often it takes a catastrophic illness or event, like getting diagnosed with cancer, for a family to realize the huge flaws with the insurance status quo. According to a recent survey, 25 percent of individuals with cancer report using up all or most of their savings as a result of the financial burden of treating cancer. Treatment is so costly, that many patients delay treatment, having a devastating effect on their health. In Texas, 10 percent of people have diabetes and 28 percent have high blood pressure. Health insurance companies often use the presence of chronic conditions like cancer, diabetes, and high blood pressure to charge higher premiums and deny coverage.

Many individuals with insurance face the same problems as those who lack coverage altogether. More than half of underinsured individuals delay medical care because of costs, and 45 percent of the underinsured have difficulty paying medical bills.

In 2007, 62 percent of personal bankruptcies were caused by medical problems. The large majority of those filers - 78 percent- had health insurance when their illness started. Most of these individuals had gone to college and were from middle-income families.

National Public Radio interviewed an underinsured family whose 2008 medical costs totaled 45 percent of their income. Click here to read and listen to the full NPR story that details the struggles of an underinsured family in America.

Federal health insurance reform will increase stability and security for Americans with insurance and will lower the cost of health care for our families, our businesses, and our government. Health insurance reform will prevent any insurance company from denying coverage based on pre-existing conditions, will limit out-of-pocket costs, and would ban annual and lifetime limits on benefits.