Health Insurance News

For decades, most Americans have counted on their employers for health insurance. But that system is crumbling, and it's crumbling faster in Arizona than it is elsewhere in the nation. Fewer than half of the state's residents are insured through an employer's plan, one of the lowest levels in the country. The rate of employer-based health coverage is falling in Arizona faster than in the nation as a whole. Job-based insurance took hold during World War II as companies offered health benefits to attract scarce workers. Encouraged by federal tax breaks, job-based benefits soon became the financial foundation of the U.S. health care system, eventually covering more than two-thirds of the population. Rising health care costs and the competitive pressures of the world economy have chipped away at that system. Now, slightly more than half of Americans have insurance through a job, a number that has been declining steadily since 2000. In Arizona, the percentage of residents with job-based insurance fell from 55 percent in 2000 to 48 percent in 2004, according to an analysis this fall by the Kaiser Family Foundation. Almost 1 million Arizonans were without insurance in 2004: about 20 percent of the population under age 65, one of the highest levels in the country. And more than 1 million residents get their insurance through the state's Medicaid program, costing state and federal taxpayers more than $5 billion per year. "We have a real serious problem in this state," said Bradford Kirkman-Liff, a professor of health policy at Arizona State University. "I think the job-based system is clearly no longer viable."

For years, demographers have predicted an explosion in demand for health care services as the baby boom generation reaches the point in life where complications from high blood pressure, diabetes, hypertension and other disorders begin to take their toll. But what might be more frightening for the nation's health is that a lot of these same boomers will face expensive health care needs without adequate insurance coverage. In its annual statistical report to the nation, the Centers for Disease Control and Prevention last month noted that many people between 55 and 65 years of age are without adequate health insurance coverage. Unless they have income well below the poverty level, or have a major disability that qualifies them for Medicaid, they have to wait until age 65 to be covered by Medicare. With more and more Americans opting for early retirement in their 50s or early 60s, some are left with no insurance at all while others sign up for individual plans with marginal benefits. Retirement health benefits provided by former employers are also being eliminated or scaled back considerably, the CDC said. And because women are three times more likely to be widowed than men during these years, women are often left without coverage when their spouses die. The baby boom generation is going into the years when heart attack, stroke and complications from diabetes are common among American adults. The national survey found that people born in the 1930s were much less likely to have complications in middle age from these common conditions than those born in the 1940s and later. The one bright spot in that outlook was in the area of cholesterol control. Baby boomers' widespread use of lipid-lowering drugs has helped reduce their risk of coronary artery disease — an improvement over the generation before them, the CDC said. But those drugs, and others that can be taken to control high blood pressure and diabetes, for instance, often come at substantial cost. Without adequate insurance, many Americans may not be able to afford them. And if you have to give up adequate health coverage when you retire, many Americans might postpone their decision to do so. That fact alone should force a serious examination of whether an employment-based insurance system is the best prescription for the nation's health.