Land of the free, home of the underinsured

An explanation for American anxiety attacks -- a sharp decline in the quality of health insurance during the Bush economy.

Published June 10, 2008 6:00PM (EDT)

Sobering numbers from a new study on health insurance: "As of 2007 an estimated twenty-five million insured people ages 19–64 were underinsured -- a 60 percent increase since 2003."

The authors define "underinsured" in terms of "cost exposure relative to income." Such measures include paying 10 percent of your income or more on out-of-pocket medical expenses (5 percent for low-income adults) or having a plan with deductibles that equal or exceed 5 percent of income.

It's all about declining quality of life. The total percentage of Americans with health insurance hasn't changed much since 2003 -- hovering around 70 percent. But cost-sharing plans, caps on benefits and sharply rising deductibles have all combined to weaken the protection offered by that insurance. If you're searching for one clear reason why Americans feel dissatisfied with the Bush economy and are anxious about globalization, here it is: While wage growth stagnates, health security is crumbling.

Underinsured and uninsured adults reported high rates of financial stress related to medical bills.

About half of uninsured and nearly half of underinsured adults reported difficulty paying bills, being contacted by collection agencies for unpaid bills, or changing their way of life to pay their medical bills. Many of those reporting bill problems also stated that they took on a loan, a mortgage against their home, or credit card debt to pay their bills, which suggests that these financial difficulties had the potential to linger into the future.

As Paul Krugman points out: "The really important thing to realize is that this deterioration in coverage took place in the best years of the Bush economy. The system is now falling apart so fast that things get worse even during periods of economic expansion."

By Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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