Rolling the dice on health coverage

“Who are these people?”

If you can afford health insurance, that might have been your first reaction to the news Friday that another 100,000 Minnesotans went without coverage in 2009 compared to 2007.

Dive into the report detail and you’ll see, increasingly, it’s a portrait of middle income Minnesota.

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Those with the lowest incomes were still far more likely to be without coverage. But there was a big jump in people in the upper middle income range, “an indication that the economic downturn has not bypassed groups that typically have low rates of uninsurance,” the state Health Department noted.

The department identified that group as having family incomes 300 to 400 percent above the poverty level of $22,050 for a family of four. That puts those family incomes at about $66,000 to $88,000.

The median family income for a family of four in Minnesota is $86,637, according to Census data.

Also, the percentage of uninsured college graduates rose from 2.4 percent in 2007 to 4.5 percent last year.

Maybe most concerning: The percentage of Minnesotans who said they got insurance from their employer dropped to 57 percent, down from 63 percent in 2007 and 2004.

Given the job hit Minnesota’s taken in this recession, that drop makes sense. But if you’re not working for an employer offering an affordable plan and you earn too much to qualify for public subsidies, the cost is brutal.

“Paying for health insurance is just not even a remote possibility right now,” Pamela Nelson of Shoreview, a source in MPR’s Public Insight Network, told us back in November. The cost of the best health plan option available to her family was the equivalent of buying a new car every year.

“Here’s the ‘least expensive’ option for our family of 4, since we do not qualify for MN Care or Medicare and do not work for employers who offer health insurance benefits: $600/month for a $10,000 deductible (catastrophic) plan…we would basically pay $17,000/year before their 80/20 coverage would even kick in.

“Lower deductible plans cost considerably more up front/monthly.” She and her husband are independent consultants, “underemployed currently and do not qualify for unemployment,” she told us then.

We’re checking in with Nelson today to see if things have changed and we’ll post any updates. But the Health Department data confirms that more families like hers are rolling the dice on coverage.

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Got a perspective or a different take on the Health Department report? Are you happy with your insurance coverage options? Post below or contact me directly.

  • http://http Sue

    It’s absolutely ridiculous that some people have to pay 25% of their income for health insurance premiums and out-of-pocket costs. We do, too. But I want to add that the statement about 4-person families earning a median income of $86,637 is misleadingly high. Other U.S. census figures report that the median HOUSEHOLD income in Minnesota for 2007-2008 was $57,607, and the median HOUSEHOLD income in the U.S. was $51,283 in 2008.

  • Paul Tosto

    Sue, thanks. The data I used pertains to family income, which the Census defines differently than household income. From the Census: http://www.census.gov/hhes/www/income/faq.html

    A family consists of two or more people (one of whom is the householder) related by birth, marriage, or adoption residing in the same housing unit. A household consists of all people who occupy a housing unit regardless of relationship. A household may consist of a person living alone or multiple unrelated individuals or families living together.

    For purposes of this particular post, I thought the use of family median income was appropriate.

    Having said that, it is hard to imagine having to pay 25 percent of income for health coverage. The cost combined with the recession has led a bunch of families to go without coverage. Minnesota is still one of the best covered states but that doesn’t make it any easier to take.

    Paul / MinnEcon

  • Jessica Sundheim

    I think it is stunning to hear that 100,000 more people had to give up their coverage. Two of my friends are included in that number. One is a young mom who lost her husband six years ago to pancreatic cancer. He didn’t have life insurance. She has two kids (13 and 8) and she had been laid off for almost a year and couldn’t continue paying for their health insurance while trying to make it on their Social Security benefits alone. She gave it up in the midst of the health care reform debate in Washington in October. It made me sick to think that they were headed into flu season without coverage. Plus, she is a single mom unable to get the preventative care that will keep her and her kids healthy.

    My other friend is a nineteen year old nanny working to save up money to go to college fall 2010. She babysat for me the first year she was out of high school while she was going to college. Because she isn’t in college this year, she is no longer covered under her parents and has no coverage. She was told by her dermatologist that she has skin patches that can be symptomatic of diabetes, but she hasn’t gone in to get them checked out. She is waiting for her dad to put her back on his insurance so that if she is diagnosed with diabetes it isn’t considered a pre-existing condition.

    Just four faces of 100,000. The insecurity they live with is unsettling. With prices that are way beyond inflation to the point where one is numbed when he hears that projected costs will amount to 1/3 of a person’s income, something needs to change. I’m standing with the majority of Congress and with the AMA, our doctors, who supported even the most hotly debated Senate bill. I’m calling my representatives, e-mailing, and talking about this with friends and family and I haven’t met one person (even though many are Republicans) who feels that our insurance system should stay the way it is now.