Pa. Will See Higher Premiums, More Uninsured If Health Reform Fails

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October 22, 2009

If Congress fails to enact health care reform, hundreds of thousands more Pennsylvanians will lose employer-sponsored healthcare over the next 10 years, swelling the ranks of the uninsured and forcing more people onto Medicaid, according to a study released earlier this week by the Robert Wood Johnson Foundation and The Urban Institute.

While much of the health care debate has focused on the likely impacts of reform proposals, this study presents an unsettling picture of the likely outcomes if our current health care system is left in place.

The Cost of Failure to Enact Health Reform: Implications for the States reports the likely results in 2014 and 2019 if no reform is enacted and the existing policy parameters and market dynamics continue to play out. Three sets of projections are reported for each state, reflecting different assumptions regarding average annual income growth in the overall U.S. economy.

Using the intermediate scenario, the projections for Pennsylvania by 2019 include the following:

  • The number covered by an employer-sponsored insurance plan would decline by 457,000;
  • The number covered by an individual insurance plan would decline by 227,000;
  • The number covered by Medicaid would increase by 334,000;
  • The number without coverage would increase by 260,000;
  • Employer-paid premiums would increase by 91 percent;
  • Individual and family spending on health care would increase by 53 percent;
  • Public spending for Medicaid and CHIP would increase by 76 percent; and
  • Uncompensated care costs would increase by 88 percent.

The Pennsylvania projections, troubling as they are, are for most indicators less severe than what is likely to occur across the United States as a whole. The authors of the report state “that the cost of failure (in enacting health reform) would be substantial and felt in every state.”

Pennsylvania-Specific Data: View the Pennsylvania fact sheet contained in the report.

Families USA Report

A Families USA report released this week estimates that about 98,500 people in Pennsylvania lost health insurance coverage in 2009 due to a rise in unemployment.

The report is based on the link between rising unemployment and health insurance coverage losses. According to the report, Pennsylvania's average unemployment rate in 2008 was 5.4 percent, while the average rate this year was 8.0 percent, thereby resulting in losses of health coverage.

The estimates are based on a model created by economists at The Urban Institute. The Institute’s formula shows that for every percentage point increase in the seasonally adjusted unemployment rate, the percentage of uninsured working-age adults grows by 0.59 percentage points.

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