Analysts say number of uninsured Americans to grow

by Lesley Politi on February 11, 2009

Analysts say number of uninsured Americans to grow

WASHINGTON (AP) — Without changes in federal policy, the number of Americans without health insurance will grow from about 45 million this year to about 54 million in 2019, the Congressional Budget Office said Tuesday.

Driving the increase will be health insurance premiums that rise faster than incomes. The CBO says premiums will increase to keep ahead of increased costs of medical breakthroughs that are extending and improving people’s lives. Also contributing to higher insurance costs will be wasteful and unnecessary medical care.

“A substantial share of spending on health care contributes little if anything to the overall health of the nation,” CBO Director Douglas W. Elmendorf told the Senate Budget Committee.

Lawmakers are looking to make big changes to the nation’s health care system over the coming years. Expanding health insurance coverage is one part of the proposed changes, but lawmakers are also considering steps to slow overall health care spending.

Otherwise, as Sen. Sheldon Whitehouse, D-R.I., put it, the nation will confront a fiscal crisis “that will make the current economic problems look like a picnic.”

This year, health spending is expected to reach $2.6 trillion and will account for about 18 percent of the nation’s economy. That spending comes to about $8,300 a person.

Elmendorf said that many analysts believe the current method of reimbursing health care providers — a set fee for a particular service — encourages more care that is not always in the best interest of the patient or the taxpayer.

He said one alternative to that approach could be to reward doctors with a bonus when they provide quality care at a savings and to penalize them when they provide substandard care. For example, hospitals with high readmission rates would see a reduction in their Medicare and Medicaid reimbursements.

Elmendorf said the current tax breaks for health insurance also reduce incentives to control costs. Currently, payments toward health insurance are not taxed. However, if they were taxed, consumers would be encouraged to shop for lower-priced health plans.

President Barack Obama campaigned against taxing health insurance premiums paid by employers and their workers, but some lawmakers say that taxing health insurance benefits would generate revenue that could subsidize coverage for millions of low-income workers.


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