What People Are Saying

"With All These People Losing Jobs, A Lot Will Lose Their Health Insurance"

President Obama has said that health reform “cannot wait, must not wait, and will not wait another year.” Today the Wall Street Journal cited evidence that illustrates why so many Americans cannot afford to wait another year for health reform. Layoffs are causing thousands of Americans to lose their health care coverage, and as was reported today, insurance companies are seeing their profits shrink as they lose members.

Earnings from the nation's big health insurers show them losing members at a rapid rate, suggesting the ranks of uninsured Americans are surging during the recession.

The latest evidence came from WellPoint Inc., the country's largest health insurer with nearly 35 million medical-plan members. Reporting a 1.3% drop in first-quarter net income Wednesday, the insurer also said it had shed nearly 500,000 net members since the end of December.

While WellPoint had factored in a large decline, it said it was surprised by the nearly 325,000 members it lost to layoffs or workers otherwise opting out of employer coverage. "We haven't run into something like this before," said Ken Goulet, head of WellPoint's commercial division, during the company's earnings conference call with analysts.

Analysts and economists have said the number of uninsured almost certainly has risen by several million people since the U.S. Census Bureau in 2007 pegged it at 45.7 million. For every one-percentage-point rise in the unemployment rate, the number of uninsured has likely grown by 1.1 million, according to research by the Kaiser Family Foundation.

Kaiser estimates that of the nine million people expected to have lost employer-sponsored health coverage since December 2007, about four million of them currently are uninsured. An additional 3.6 million have likely enrolled in Medicaid or other public programs, estimates the foundation.

On Tuesday, UnitedHealth Group Inc., the second-largest insurer in terms of members, reported a 900,000 drop in the number of people enrolled in its commercial health plans in the first quarter, compared with the end of last year, many because of higher-than-expected layoffs at the insurer's employer clients.

It is unclear how many of those people have or will find coverage elsewhere or qualify for government insurance such as Medicaid. "It's probably not a surprise that with all these people losing jobs, a lot will lose their health insurance," said Paul Ginsburg, president of the Center for Studying Health System Change, a Washington, D.C., health-policy research group.

Hospitals say they also are seeing some signs of more patients without insurance. The hospital chain Tenet Healthcare Corp. said earlier this week that its number of admissions of patients with private health coverage declined 2% in the first quarter from a year earlier, while outpatient visits of insured patients slipped 0.4%, when adjusted for last year's leap-year effect. A study released by the American Hospital Association in November found that one-third of U.S. hospitals had seen a noticeable decrease in elective procedures, such as knee replacements, during recent months.

The Wall Street Journal, Thursday, April 23, 2009