Drop in uninsured: is the crisis over? 

According to the U.S. Census Bureau, the number of Americans without health insurance dropped last year, for the first time since 1987.  

The number of uninsured fell by 1.7 million people to 42.6 million in 1999.  As compared to the 42. million people without health insurance in 1998, this represented a drop of 3.8%.  On a pure percentage basis, 15.5% of Americans had no insurance in 1999, as compared to 16.3% in 1998.

The increase in the number of insured Americans (again, according to the Census Bureau) was due to an increase in employer-supplied health insurance.

The Health Insurance Association of America, which represents insurance companies, states that these new data show how efficiently private sector is working in addressing the problem of uninsured Americans.  Regulatory intervention, HIAA says, is therefore clearly unnecessary.

Groups in favor of the Patient Bill of Rights, on the other hand, point to these data as clear evidence that increasing patient-protection regulations will not (as HIAA claims) massively increase the number of uninsured.

DrRich comments:

This summer, DrRich was doing some consulting for a major biomedical company, and while he was talking to the CEO, the subject of the growing number of uninsured Americans came up.  DrRich, as one might expect, launched into his standard polemic about how the relentless rise in health insurance premiums (which was inevitable whether or not a Patient's Bill of Rights was adopted) would result in an inexorable increase in the number of uninsured Americans.  "After all," DrRich said as confidently as Al Gore announcing that, as a matter of fact, he'd come to Texas himself to cluck over the disasterous fires, "you're not going to tolerate increasing health insurance premiums forever."

The CEO gave DrRich the same polite raised eyebrows and shake of the head that George W. had returned to Gore.  "Actually," he said finally, "the higher the better."

What?

"Were in hot competition for competent workers," he explained patiently.  "And we'll pay health insurance premiums with a smile on our face to get them.  The higher the premiums, the better our competitive advantage in attracting these workers."

So that's the bottom line.  It's all just supply and demand.  Insurance premiums are now rising at double digits.  This is bad for self-insured individuals, but for successful companies enjoying a booming economy and faced with a shortage of skilled labor, it's not so bad at all.  It may even be an advantage.

What this means, DrRich surmises, is that as long as the unprecedented economic expansion continues, perhaps the heretofore growing number of people without health insurance will continue to fall.

But with premiums reaching sky-high levels and still growing, once we hit a real slowdown in the economy - or heaven forbid, an actual recession - la deluge.

10/07/2000

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