AMA report spotlights rising insurance premiums

But new tax credits and more coverage choices can turn the system around, the report says.

By Robert Kazel, AMNews staff. Sept. 15, 2003.

Total health premiums paid by workers and their employers have risen by 43.4% since 1998, and the rate of growth in premiums is quadruple that of consumer prices, according to an AMA study that gauges recent trends in health coverage.

The consumer price index rose by 10.4% between 1999 and 2002, while health insurance premiums swelled by an average 9.4% during each of those years, said the Association's "Health Care Financial Trends Report," released in August.

And although employees and companies say spending more on health insurance is a problem, the report reiterated that a longstanding issue is much more alarming: The number of uninsured Americans, many of whom are employed, now stands at a record 40.9 million people.

Those without health coverage "receive less preventive, routine, and necessary care, have poorer health outcomes, and have lower earnings than insured persons," the authors of the report said. "They also face the enormous financial risk associated with chronic or catastrophic illness."

The AMA report came out just as a survey by the State University of New York at Stony Brook found that more workers are concerned about improving their medical benefits than getting a raise. More than seven in 10 workers said they would, in fact, choose better health coverage and a lower salary over better pay and no health coverage. Furthermore, half of those polled said they are worried their medical benefits will be reduced in the next year, while 29% are worried about losing coverage altogether.