What We’re Reading: Health Insurance Woes

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Two new studies paint a grim picture of the health insurance landscape in the United States, while a state report on insurance in Massachusetts, which launched a program aimed at universal coverage in 2006, offers hope and a glimpse of the costs that such a program entails.

According to an Associated Press article about a study on Medicare’s prescription drug benefit, many people with chronic illnesses stop taking their prescribed drugs once they reach Medicare’s coverage gap (widely nicknamed the “doughnut hole”), in which they must pay the full cost of their medicine. This includes 10% of people with diabetes and 16% of those with high blood pressure; the overall rate is 15%. An additional 5% switch to a different, cheaper drug, while 1% reduce the dose of their current drug. Although some Medicare prescription drug insurance plans offer some coverage for people inside the “doughnut hole,” these plans are more expensive than those without such coverage.

Meanwhile, the Washington Post reports, based on a recent survey, that rising medical costs and lack of adequate insurance are leading to widespread financial trouble and more medical debt than ever before. Two startling numbers: 28% of working-age adults lacked health insurance at some point during 2007, and of those who accumulated medical bills, 29% said they could not pay for such necessities as food, rent, or heat as a result.

This makes the news from Massachusetts, reported in the Boston Globe, that 439,000 of its estimated 600,000 uninsured residents have signed up for coverage since 2006 especially encouraging. The state has saved some money from the drop in uninsured residents receiving routine care in emergency rooms (where it is much more expensive), and employers now pay almost $1 billion more in insurance premiums due to an increase in private coverage. But the program has proven to be much more expensive than originally predicted, leading to uncertainty over its future and whether it could serve as a model for national health insurance reform.

This blog entry was written by Editorial Assistant Quinn Phillips.

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