Jobless Utahns priced out of health care

With the cost of continuing health care coverage amounting to three-fourths of unemployment insurance benefits, most newly unemployed Utahns are also newly uninsured, or are about to be.

According to a state-by-state assessment released this morning, the ripple effect of having the highest national unemployment rate since 1945 will cause a dramatic increase in the number people who have no medical coverage.

Because a job and health insurance are linked through the workplace for about 80 percent of Utahns, a job loss is a double whammy for families, according to the nonpartisan, nonprofit health care policy research group Families USA.

Workers can retain their employer-sponsored insurance if those laid-off can afford to pay the full cost of continuing that coverage, Ron Pollack, executive director, said in a Friday conference call with news media nationwide.

"That's possible in a few cases, but in Utah as in 40 other states, the insurance premium is almost as much as the worker's monthly unemployment check," he said, noting that the Consolidated Omnibus Reconciliation Act (COBRA) designed to prevent workers between jobs from a lapse in coverage isn't a practical option.

"COBRA health coverage is great in theory and lousy in reality," Pollack said. "For the vast majority of workers who are laid off, they and their families are likely to join the ranks of the uninsured."

Prior to the recession, an estimated 45 million Americans, including 300,000 Utahns had no insurance. "The numbers of the uninsured and underinsured will undoubtedly increase significantly," he said.

A Utah family continuing under COBRA for pays on average $1,030 per month, or 76.8 percent of the $1,341 monthly unemployment check. For an individual, the average COBRA payment is $363, or 27 percent of unemployment.

Average monthly benefits are calculated by multiplying average weekly benefits for all unemployed workers by a conversion factor of 4.3. This calculation assumes that individuals receive unemployment benefits for four consecutive full weeks.

Calling COBRA a catch-22 and a "ruse," Pollack noted that "if laid-off workers do not continue their employer-based coverage by electing COBRA and instead seek coverage in the individual health, those with health problems are likely to find that no insurer willing to sell them a policy is willing to cover their pre-existing conditions such as high blood pressure or diabetes at any price."

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E-mail: jthalman@desnews.com