Ranks of R.I. uninsured grew 9% in ’08

By Ted Nesi
Providence Business News Web Editor

The number of people in Rhode Island without health insurance coverage climbed to 123,000 in 2008 from 113,000 the previous year, the U.S. Census Bureau reported today.

With 10,000 more people losing health insurance coverage last year, the percentage of Rhode Islanders who are uninsured rose to 11.8 percent from 10.8 percent in 2007, the agency said in its annual report on incomes, poverty and health insurance.

The percentage of Rhode Islanders with some form of private or public health insurance fell to 88.2 percent, down from a recent peak of 91.4 percent in 2006. At the start of the decade, in 2000, about 93 percent of state residents had health insurance coverage.

The figures also showed more people lost private and employer-sponsored coverage last year. The share of Rhode Islanders with private health insurance (which includes employer-sponsored and individually purchased policies) fell to 70.7 percent from 71.6 percent in 2007.

The percentage of residents with employer-sponsored coverage declined by 28,000 to 633,000, or 60.6 percent, from 63.4 percent in 2007. By contrast, 76.2 percent of Rhode Islanders had private insurance coverage and 66.7 percent had an employer-sponsored plan in 2000.

The average family health insurance premium for plans offered by Rhode Island employers cost $13,363 last year, ninth-most in the country and up 41 percent since 2003, according to a study released last month by The Commonwealth Fund, a nonpartisan research group.

The percentage of Rhode Islanders with government health insurance rose to 30.2 percent last year from 29.8 percent in 2007. That was still below the 32 percent that had public coverage in 2006 and only slightly more than the 29.9 percent that had government coverage in 2000.

The main reason for the sharp drop in public insurance coverage was the ongoing decline in enrollment in Medicaid, the government insurance program for the poor that the state has cut to combat repeated budget shortfalls.

Despite a worsening economy, the number of Rhode Islanders on Medicaid fell to 156,000 (15 percent of residents) last year, down from 222,000 (21.1 percent) in 2006, a nearly 30 percent reduction over two years.

Over the same period, enrollment in Medicare, the federal health insurance program for Americans age 65 and older, increased to 163,000 (15.6 percent) from 150,000 (14.3 percent). Medicare is paid for by the federal government, while the cost of Medicaid is split between the federal government and the state.

The Rhode Island unemployment rate averaged 7.8 percent last year, reaching 9.4 percent in December, according to the U.S. Labor Department. The state jobless rate stood at 12.7 percent in July.

Nationwide, the number of uninsured Americans rose to 46.3 million in 2008 from 45.7 million the year before. Analysts told Bloomberg News the increase in the number of uninsured Americans was caused by the recession and the accompanying rise in unemployment, and is likely to continue to grow until the economy turns around.

Massachusetts, which enacted a sweeping health reform law in 2006, had the highest rate of insured residents last year at 94.5 percent, up from 90.8 percent in 2005.

The new figures were released the morning after President Barack Obama addressed a joint session of Congress to make a pitch for his administration’s health insurance reform plan, which would outlaw some insurance underwriting practices; require all Americans to buy coverage; and provide insurance subsidies to poorer citizens, among other policies.

The Census Bureau also reported that the nation’s median household income fell 3.6 percent last year to $50,303, the first decrease in four years.

The number of Americans in poverty rose to 39.8 million from 37.3 million in 2007, boosting the nation’s official poverty rate to 13.2 percent, the highest level since 1997. The poverty line in 2008 was defined as an annual income of $22,025 for a family of four.

The Northeast was the only one of the nation’s four regions that did not see a statistically significant change in household income, which stood at $54,346 here last year. However, the Northeast was also the only region that saw a decline in 2007.

The decline in household earnings, coming amid the record $13.9 trillion loss in U.S. household wealth since mid-2007 caused by the economic crisis, could hamper the nation’s recovery from recession, Heather Boushey, a senior economist at the Center for American Progress, a research organization headed by John Podesta, a leader of the Obama administration transition team, told Bloomberg News.

“The decline in incomes we’re seeing certainly has implications for consumer spending, particularly post-housing bubble when families can’t tap into home equity through loans,” she said.

Additional information is available at Census.gov.


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