Economic Cost of the Uninsured

The Henry J. Kaiser Family Foundation in May 2002 performed a study on the cost of not covering the uninsured and the consequences of being uninsured. Their major findings included:

• Health insurance reduces mortality rates, meaning a person with health insurance will have a longer lifespan, by 10-15%.
• “The combination of less ability to work and lower productivity resulting from poor health has been estimated to reduce earnings by between 10 and 28%, depending on race and gender, over a 10-year period.”
• Through the national health insurance program, expanding health insurance coverage in Canada reduced infant mortality, the number of deaths of children under the age of 1, by about 4%.
• “The uninsured are 30-50% more likely to be hospitalized for an avoidable condition.”
• “The average cost of an avoidable hospital stay in 2002 is estimated to be about $3,300.”

To read the entire report, click on Sicker And Poorer: The Consequences of Being Uninsured.

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The Institute of Medicine of the National Academies in 2003 also performed a study on the cost of not covering the uninsured and the consequences of being uninsured. Their major findings included:

• “Americans devote more economic resources to health care than people in any other nation in the world, both in total dollars spent ($1.236 trillion for personal health care services in 2001) and as a percent of the gross domestic product (14 percent)”
• The uninsured poppulation have a 25% higher mortality rate
• The estimated “economic value of the healthier and longer life that an uninsured child or adult forgoes because he or she lacks health insurance ranges between $1,645 and $3,280 for each additional year spent without coverage”
• The “aggregate, annualized cost of the diminished health and shorter life spans of Americans who lack health insurance is between $65 and $130 billion for each year of health insurance forgone”
• “The total cost of health care services used by individuals who are uninsured for either part of or the entire year is estimated to be $98.9 billion for 2001”
• “The best available estimate of the value of uncompensated health care services provided to persons who lack health insurance for some or all of a year is roughly $35 billion annually, about 2.8 percent of total national spending for personal health care services”

To read the entire report, clicking on Hidden Costs, Value Lost: Uninsurance in America.

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The New America Foundation in November 2008 also performed a study on the cost of not covering the uninsured and the consequences of being uninsured. Their major findings included:

• “In 2006, our economy lost as much as $200 billion because of the poor health and shorter lifespan of the uninsured”
• “The economies in California, Texas, and Florida suffer most from productivity loses stemming from the uninsured. Yet, Delaware’s economy loses more per uninsured person — over $6,800 per uninsured resident.”
• “The cost of the average employer-sponsored health insurance plan (ESI) for a family will reach $24,000 in 2016. This represents an 84 percent increase over 2008 premium levels.”
• “Under this scenario, we estimate that at least half of American households will need to spend more than 45 percent of their income to buy health insurance.”

To read the entire report, click on The Cost of Doing Nothing.