Middle-class Americans – those with incomes from $44,000 to $88,000 — face mounting out-of-pocket costs that are eroding household disposable income available for food, shelter, and energy line items.
While most of the uninsured are from lower-income families, 11 million of the uninsured live in middle class working families. Most of the growth of the uninsured between 2004 and 2007 — 70% — is in the middle class.
The chart tells the tale: the gap between health premium increases and workers’ wages continues to widen, making health insurance unaffordable for more working families.
Health Populi’s Hot Points: Put in context of household health spending, the average annual family contribution for employer-sponsored coverage rose to $3,354 in 2008, shown in the chart. KFF calculates that this equates to 7% of a household’s pre-tax income. In the real world of disposable income, this might roughly equal 10% of income after tax – or $1 in every $10 of “take home pay.”
This would be in addition to out-of-pocket costs for deductibles, office and ER visits, and prescription drugs.
As the gap widens between health costs and take-home pay, health care insecurity is growing. A New York Times cover story today is titled, “Reach of subsidies is critical issue for health plan.” In this recession, health reform isn’t just about access-for-all; it’s about affordability-for-all.