newjerseynewsroom.com

BY RAYMOND J. CASTRO

COMMENTARY

Uninsurance is no longer just a problem in New Jersey. It is a crisis.

The number of uninsured in the state has been increasing almost every year since 2000. In 2010, it was about 50 percent higher than in 2000. This rate is even higher than the national average, which increased by about a third. There are about 1.3 million uninsured people in New Jersey. In other words, one in seven New Jerseyans do not have health insurance of any kind.

We have made major progress in insuring children because of NJ FamilyCare, but the problem for adults has gotten much worse. Eighty-eight percent of all the uninsured in New Jersey are non-elderly adults, of whom 60 percent are employed, mostly in full-time jobs. These employees are playing by all the rules to support their families but they are still being denied the right of basic health care.

The downturn in the economy has also shown that all of us are only one paycheck away from losing our insurance. Twenty percent of all adults in New Jersey are uninsured regardless of income. And the problem for low-income adults is even worse: almost half are uninsured.

Most uninsured individuals aren’t able to afford private insurance because of unrelenting increases in premiums. Even during the recession, we saw double-digit increases in health insurance premiums in the individual and small group markets. New Jersey has the third highest premiums in the individual market in the nation.

This has resulted in a dramatic drop in New Jerseyans who have private health insurance. Since the 1990s the number of persons with comprehensive insurance in the individual market has decreased by 70 percent. Today only 3 percent of all the uninsured directly purchase health insurance. We are seeing the same trend for small employers. In the last five years the number of persons with insurance in the small group market decreased by 170,000, a 20 percent decrease. Currently only about half of all small employers provide health insurance to their employees.

High insurance costs are also resulting in more cost sharing and less coverage even for families with employer-based insurance. Since 2000 the employees’ share of premiums increased by 150 percent, although median wages remained the same. Also in the individual market more people are buying bare-bones polices that will not adequately cover emergencies. About a quarter of all individuals with insurance are underinsured.

The growing lack of affordable, quality health insurance is having a profound impact on our state’s health and economy. About half of all foreclosures are caused by medical costs, and most of those families have health insurance. It means less productive workers which puts New Jersey at a competitive disadvantage, fewer health jobs to stimulate the economy, and unpaid emergency costs that threaten hospitals across the state. Children, who are our state’s future, are more likely to have better health if their parents are healthy too.

The increase in the uninsured causes the cost of their medical care to be passed on to everyone else, which results in more individuals and employers dropping insurance because their costs have gotten too high. That in turn results in even further increases in the uninsured causing a downward spiral that will not end until New Jersey enacts The New Jersey Health Benefit Exchange Act (S1319/A2171), which represents the interests of consumers and addresses some of the root causes of the uninsurance problem.

Raymond J. Castro is the Senior Policy Analyst at New Jersey Policy Perspective.

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