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All across the country, working families and businesses are struggling with the rising costs of healthcare. The cost of healthcare is skyrocketing. The number of uninsured is rising sharply. And it is becoming increasingly difficult for businesses, especially small businesses to provide health coverage for their employees and retirees. The need for access to affordable healthcare is clear. The time to act is now. That is why the Governor is making access to affordable health insurance for all Illinoisans his top priority.
Families Struggling with High Cost
- Almost 50% of the American public say they are very worried about having to pay more for their healthcare or health insurance, and 42% report they are very worried about not being able to afford healthcare services.
- Nationally, the cost of premiums for family coverage ($11,480) outpaced the earnings of a full-time, minimum wage worker ($10,712).
- A 2005 survey showed that more than 25% said housing problems resulted from medical debt, including the inability to make rent or mortgage payments and the development of bad credit ratings.
- According to research from Harvard University, medical-related bankruptcies have jumped 2,200% since 1981. The middle class accounts for 90% of those cases. And in many of these cases, the families who suffered bankruptcies had health insurance. They just couldn't keep up with the rising costs.
Rising Number of Uninsured
Businesses Struggling with the High Cost
- A growing number of employers are either not offering health coverage to their workers or are offering coverage that is no longer affordable to their workers. High health costs are hurting all businesses but are especially difficult for small businesses and their employees.
- The Institute of Medicine estimated that if all Americans had health coverage the potential economic gains would be between $65 and $130 billion each year.
- Health insurance is considered by employees as the most important employee benefit. And a recent survey found that two thirds of workers say healthcare benefits are a very important reason to stay with their company.
- The same study shows that nearly a quarter of "top performing employees," that companies want to hold on to, cited poor healthcare benefits as one of the top three reasons they would leave an employer.
- Providing good coverage makes sense, and dollars for that matter. Insured workers are more likely to stay longer, stay healthier and be more productive.
Declining Benefits - Soaring Costs
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Health insurance premiums for employers increased nearly 87% between 2000 and 2006.
- Over the past five years, health insurance premiums for businesses have increased nearly five times faster than inflation and four times faster than wage growth.
- By cutting into operating margins, high premium costs are reducing the capacity of businesses to grow by investment in research, capital spending, product development and marketing.
- A recent labor economics study suggests that rising health insurance premiums are resulting in job loss, wage decreases and reduction in employee's hours of employment.
- Since 2000, the percentage of firms offering health benefits has fallen from 69% to 61%.
Big Business - Big Burden
- On a per-car basis, General Motors now spends more money on health insurance than on steel.
- In 2005, Ford's healthcare expenses topped $3.5 billion dollars. Prescription drugs accounting for a third of the total healthcare expense. Today, providing healthcare benefits for current and retired workers adds about $1,000 to the sticker price of every car and truck built in the United States.
- Starbucks reports that they now spend more on health insurance than on buying coffee.
- A FamiliesUSA study found that the health insurance premiums for family coverage here in Illinois were increased by $1,059 due to cost shifting from the uninsured. As health insurance premiums increase and employers cut back on coverage, this results in those employers who continue offering benefits paying more.
Loss of Productivity
- When uninsured workers get sick, they miss significantly more work than their insured counterparts,
translating into a loss of productivity for their employers. The annual cost of reduced productivity due to uninsured workers in the nation's top 200 largest companies is estimated between $87 billion and $126 billion dollars.
Small Business - Big Hurt
- There are over one million small businesses in Illinois.
- In 2006, health insurance premiums for the small businesses increased between 10 and 11%.
- As a result of high health insurance costs, over the past five years 266,000 firms - 90% of which employ 3-24 workers - stopped offering health coverage to their employees.
- In 2006, only 45 percent of workers in the smallest firms (3-24 workers) were covered by their employer's health benefits.
Small Businesses Pay More for Healthcare
- Small firms pay more for coverage because they lack the bargaining clout of large companies. They are also more vulnerable to sharp premium increases and they pay higher costs to have their plans administered.
- According to a recent poll, 70% of small businesses picked healthcare costs as their most rapidly growing expense.
- Rising and unpredictable health insurance costs paralyze small businesses and translate into job loss and failure to hire.
- Employees in small firms who insure their families contributed nearly $1,100 more a year for premiums in 2005 than their counterparts in large firms.
- Employees in small firms also pay substantially higher deductibles than those in large firms. Workers in small firms enrolled in PPO plans must pay deductibles that are 100% higher when using in-network providers and 60% higher when using out-of-network providers.
A Shared Problem and a Shared Solution
- Access to affordable healthcare is a problem that faces everyone - the uninsured, the insured, business and government.
- The medical community, businesses, government and everyday people recognize the need for reform to make sure all people have access to guaranteed, affordable healthcare.
- America's leading hospitals, medical groups and insurance companies have recently begun working together to support efforts to increase access to healthcare for all Americans.
- The U.S. Chamber of Commerce, the Business Roundtable and prominent companies, like General Motors, have all recently called on states and the federal government to expand healthcare to all.
- Several states are implementing plans to insure all of their residents, including Maine, Hawaii, Vermont and Massachusetts, and more have proposed plans, including California and Pennsylvania.
Developing a Plan for Illinois
- Since Governor Blagojevich took office in 2003, over 560,000 more men, women, children and seniors have healthcare who didn't have it before. We need to build on that progress.
- Our goal is to create a plan to provide guaranteed, affordable access to quality healthcare for everyone without raising the income or sales tax.
- We have been studying plans developed by other states and recommended by the Illinois Adequate Health Care Task Force.
- We are meeting with legislators, medical providers and healthcare advocates to get their input and learn from their experiences.
- We want a plan that will expand access to existing programs and create an affordable, quality option for all men and women, and small businesses.
- We believe healthcare costs are a shared responsibility, and that government, business and individuals are all responsible to pitch in and make it work.
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