You Should Know:

• Health care costs continue to grow at a faster rate than patients and employers can manage, driving up the number of those without health coverage.
• The impact of the uninsured on society is enormous. The uninsured get less needed medical care than those with coverage and have higher mortality rates. And, the cost of care for the uninsured, when they access it, is shifted to the government, medical professionals, and the insured population in the form of higher premiums.
• An individual coverage requirement, a measure requiring all individuals to possess at least basic health insurance and providing subsidies for those who cannot afford coverage, would guarantee nearly everyone has access to quality health care.

Background

The U.S. Census Bureau places the number of uninsured people in the U.S. at 45.7 million in 2007, down slightly from 2006 but still unacceptably high.¹ Who are they? Eight in 10 uninsured live in families with at least one worker; most uninsured workers are self-employed or work for small firms that don’t offer benefits; 66 percent of the uninsured come from low-income families (below 200 percent of the federal poverty level), but a surprising 9.1 million earn $75,000 or more. The uninsured span the age spectrum, but young adults have the highest uninsured rate (28 percent of 18-24 year olds and 25.7 percent of 25-34 year olds); 78 percent of the uninsured are U.S. citizens; non-citizens have high uninsured rates due to employment in low-wage jobs. Minorities have been hit hard by the problem – 7.4 million blacks or 19.5 percent, and 14.8 million Hispanics or 32.1 percent are uninsured.

• The Urban Institute estimates that 22,000 deaths occurred in 2006 due to a lack of coverage.² Uninsured people are almost three times as likely to report going without medical care as insured people, particularly preventive screenings and care for chronic conditions.³
• Employers are feeling the pressure of rising health costs, which has caused the number of workers with employer-sponsor coverage to shrink. The number of employers offering health coverage to their employees has continued to drop, from 69 percent in 2000 to 60 percent in 2006.⁴

Aetna’s Solution

Aetna has introduced and circulated a comprehensive plan to improve access and health care quality for all Americans. Called “To Your Health! Aetna’s Proposal for Health Care System Transformation,” this plan offers a framework for meaningful change that emphasizes the value of a public-private partnership that builds on the best of private sector innovation while working to preserve and enhance the public sector safety net. Its four pillars are:

• Get and keep everyone covered – transform health insurance into a civic responsibility and strengthen public programs for those most in need. Aetna was the first national insurer to endorse an individual coverage requirement
• Maintain the employer-based system and export its strengths to make the individual market function better – leverage the strengths of a system that already covers 85 percent of the population.
• Reorient the system toward prevention, value and quality of care – promote preventive care and wellness, and improve patient safety.
• Use market incentives to improve coverage, drive down costs and make the system more consumer-oriented – create a legislative/regulatory environment more conducive to making available more affordable coverage options, make the system more transparent and reduce costs through information technology.

Aetna also has devised a multi-pronged strategy that is generating business solutions to issues faced by those most often lacking health insurance. Strategic Resources Company, an Aetna company, provides low-cost health benefits products for part-time and hourly workers, while Aetna Student Health serves 450,000 student members in 170 schools with access to affordable, innovative health care and partners with campus health centers to provide student-centered care. Aetna also is introducing a set of new products, called ValuePick, in states across the country that is designed to give uninsured small businesses affordable coverage options for their workers.

Q & As:

Q: Wouldn’t a single-payer system eliminate the problem?
A: Single-payer systems, such as those in Canada, Britain and Germany place the financial burden of health care on the government and taxpayers rather than the consumers who are most capable of determining their health care needs. In a single-payer system, the government determines the budgets for hospitals and fees for individual doctors. A limited budget for health costs means that services must be rationed –– from the number of patients a doctor may see to the number of babies a hospital may deliver. These capped budgets also curb access to innovative medical technology and services. The single-payer system also relies on the working taxpayers to pay for the health care of the disproportionate number of elderly, placing further strain on an already limited budget.

In 2005, the Supreme Court of Quebec, Canada, ruled a ban on private insurance unconstitutional. Health care systems everywhere, including single-payer systems, have been beset by rapidly rising costs. While health care coverage systems vary across Europe, most have allowed private insurers back into the market, offering varieties of savings accounts and plans that reward consumers for being intelligent and efficient health care consumers. A better way to manage health care costs is through collaborative private and public initiatives that drive down costs while giving consumers the opportunity to make smart health decisions in their own best interests.

Q: Don’t the uninsured already receive free or discounted health care?
A: No, uninsured patients typically do not receive services at discounted rates. In fact, most are likely to go without care at all or be treated in high-cost emergency room settings. According to the Kaiser Commission on Medicaid and the Uninsured (August 2008), one-quarter of uninsured adults “go without needed care due to cost each year.” Because they do not receive early treatment and regular preventive care, the uninsured are more likely to be hospitalized and die from preventable causes. When those without coverage do receive treatment, expenses are significantly higher than those of their insured counterparts due to group discounts negotiated by employer-sponsored insurance plans. According to Health Affairs, bills that cannot be paid – the uninsured will receive about $56 billion in uncompensated care in 2008 – are passed on to taxpayers through government programs that will finance 75 percent of the cost, or to the privately insured through higher rates. In short, America covers the uninsured in the least effective, most expensive manner possible.

Q: Doesn’t an individual coverage requirement place a financial burden on the poor?
A: A properly designed individual coverage requirement would encourage personal responsibility by recognizing that those who can afford health coverage should purchase it, and by acknowledging that government should help pay for those who truly cannot afford it. To be workable, subsidies from low-income individuals should be paid for through a broad-based funding mechanism. If this happens, the poor would benefit by enjoying the same access as everyone else to health care innovations available through a competitive, private marketplace that is not encumbered with regulation.