Health coverage hurts wallets
Many isle families cannot afford to pay rising premium rates, a study says
Health insurance costs have far outpaced average earnings for Hawaii workers, causing many to lose coverage and go into debt, Families USA reported today.
More than half of bankruptcies are due at least partly to problems with medical costs, the nonprofit health consumer organization said.
From 2000 to 2006 in Hawaii, it said:
» Health care premiums rose 4.2 times faster than average wages.
» Annual premiums went from $6,047 to $9,952 in the six years, an increase of $3,906 or 64.6 percent.
» Median earnings went from $26,180 to $30,205 in the six-year period, or 15.4 percent.
Cliff Cisco, senior vice president of the Hawaii Medical Service Association, Hawaii's largest health insurance carrier, estimated that HMSA's community group rates from 2000 to 2006 increased 48.9 percent rather than 64.6 percent.
"There is no question even that is higher than the median earnings," added Cisco, member of the Hawaii Uninsured Project's leadership group.
Ron Pollack, Families USA executive director, said in a news release: "Hawaii families have been hit hard in the pocketbooks due to skyrocketing health costs and stagnant wages.
"As a result, Hawaiians are paying much larger portions of their paychecks on health care, and health care is becoming less and less affordable."
Hawaii workers also are getting "thinner coverage" for higher prices, the report said. That is, fewer benefits and/or higher deductibles, co-payments and co-insurance.
"Health care costs are absorbing an ever-larger portion of family budgets, and it is clear why many Hawaii families feel worse off economically than they did six years ago," the report said.
Non-elderly uninsured Isle residents total more than 116,000, about 10.7 percent of the non-elderly population, the report said.
"I don't dismiss the fact that health insurance is very expensive," said Laurel Johnston, Hawaii Uninsured Project executive director. But she said, "A lot of times, national groups don't understand the dynamics" of Hawaii's Prepaid Health Care Act.
"Our premiums tend to be lower than the national average and our increases have not been as high as those nationally," she said. Also, she pointed out, employers pay 90 percent of the premiums.
Johnston said the state has made much progress in getting insurance coverage for children. "As far as adults, we haven't moved the needle much. We're still very concerned.
"People who are working several part-time jobs don't have coverage and they can't get into QUEST (the state health program) because of a cap," she said.
Small businesses and sole proprietors also are struggling to provide workers with health coverage under the state mandate, Johnston said.
One of the options suggested by the Uninsured Project to provide them with better rates is some type of purchasing pool associated with the state or Medicare, she said.
HMSA gives the state a favorable rate and though state employees pay more of the premium, the premiums are lower than those for a person in the private market, she noted.
Breaking out costs paid in Hawaii by employers and employees for premiums, Families USA reported:
» The employer's portion of annual premiums for family health coverage in Hawaii in 2000-2006 rose 52.2 percent, from $4,735 to $7,206.
» The worker's share of annual premiums for family health coverage rose 109.5 percent, from $1,311 to $2,747.
» The employer's portion of annual premiums for individual coverage rose 44.7 percent, from $2,176 to $3,148.
» The worker's portion of annual premiums for individual coverage rose 84.1 percent, from $190 to $350.
Beth Giesting, Hawaii Primary Care Association executive director, said Hawaii's uninsured population seems to be holding steady because of the good economy and a progressive state policy of adding more children to the QUEST program.
However, she said, "What Families USA is saying is right on. People are losing private insurance because they can't afford it.
"What a lot of people don't realize is that Hawaii's health insurance premiums are really quite reasonable compared to what you get across the mainland but costs keep going up," she said.
Gap groups will continue to increase without some policy about who is going to pay for health coverage and care, she said.
Giesting, who is also a member of the Uninsured Project leadership group, said Hawaii "is really blessed by the employer mandate," which results in "pretty reasonable premiums for what we get. But if you were to lose your job, how could you afford to have something expensive like health insurance?"
"The real question is how we're going to deal with low-income adults who may have a couple jobs but no health benefits or may be self-employed," Giesting said. "What kind of programs or subsidies are we going to have for them?
"We've all seen the increase in housing, gasoline and all those things. That's why we have all those people living on the beach in Waianae."
The Hawaii Uninsured Project is in its fourth year and wrapping up this month, Johnston said: "We basically raised awareness among the community and certainly policymakers and the administration about the uninsured."
The last meeting of the leaders will be Wednesday, she said: "We're hoping some members will carry on the message."
The Families USA report, "Premiums Versus Paychecks," cites national problems with rising health care costs and stagnant wages during the first six years of the new millennium.
In Hawaii, it says, "Illness, high medical costs and the resulting financial insecurity form a vicious circle. Faced with loss of insurance, families with mounting medical debt are drawn deeper into financial turmoil."
If this trend continues, Pollack said many more islanders will become uninsured and underinsured and "will face diminishing economic and health security. It is high time for national leaders to address this growing problem and make it a top national priority."
Families USA based its report on data from the U.S. Census Bureau, U.S. Department of Labor and U.S. Department of Health and Human Services.
