Finance Globe

U.S. financial and economic topics from several finance writers.
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U.S. Median Income Falls But Fewer Are Without Health Insurance

Americans continued to feel the pinch in a sputtering economy and saw their incomes decline for the second year in a row - but fewer people are going without health insurance, according to a report released by the U.S. Census Bureau on Wednesday.

The U.S. median household income fell 1.5 percentage points to $50,054 in 2011 - falling the most for blacks, who experienced a 2.7 percent decline in their incomes from 2010 to 2011, while the median income for whites slipped 1.4 percent. The median income for Asians and Hispanics had no statistical change in 2011. Asians had the highest median income of $65,129, and blacks had the lowest median income of $32,229.

The Census Bureau also reported that after three years of consecutive increases, the U.S. poverty rate of 15.0 percent changed little from its rate of 15.1 percent the year before. Approximately 46.2 million people were living at or below the 2011 poverty threshold of $23,021 for a family of four.

For some good news, the percentage of people going without health insurance fell from 16.3 percent in 2010 to 15.7 percent last year as the number of uninsureds fell from 50 million in 2010 to 48.7 million in 2011.

Not surprisingly, people in lower income households were more likely to be uninsured than those in higher income households. In 2011, one in four with a household income of less than $25,000 was uninsured, and that rate decreased proportionately with each increasing income bracket. Only 7.8 percent were uninsured in households earning $75,000 and above.

By region, the Northeast had the lowest percentage of people going without health insurance at 11 percent, and the West and the South had the highest uninsured rates at 18 percent and 18.3 percent, respectively. The uninsured rate in the Midwest was 12.7 percent.

The drop in the rates and numbers of uninsured people was likely due to an expansion of government healthcare programs and increased enrollment in Medicare, Medicaid, and the childrens health insurance program. Also, an estimated 3 million young adults gained health coverage as a result of the provision of the 2010 healthcare law that enables young adults to remain on their parents’ policies until the age of 26.

Health insurance costs continue to rise, making it difficult for many to squeeze health coverage into their budgets. Employer-sponsored health insurance rose 4 percent from last year - outpacing wage increases of 1.7 percent and inflation at 2.3 percent - and workers paid an average of $4316 towards their coverage, according to a report released by the Kaiser Family Foundation on Tuesday.

Despite health insurance being financially out-of-reach for many Americans, a 4 percent premium increase is considered moderate, says Kaiser President and CEO Drew Altman, Ph.D.

“In terms of employee insurance costs, this year’s 4 percent increase qualifies as a good year, but it still takes a growing bite out of middle-class workers’ wages, which have been flat or falling in real terms,” Altman said.

Kaiser reported that health insurance costs have risen 97 percent since 2002, increasing three times as quickly as employee wages and inflation.


Sources:
U.S. Census Bureau
Kaiser Family Foundation
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Monday, 21 October 2019

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