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Survey: Disparity in Ohio's health premiums, wages is wider than U.S.

Tuesday, October 17, 2006

Ohioans' earnings have grown more slowly than the national average while health costs in the state have skyrocketed as much as or more than they have across the country, according to a new report.

Families USA, a group that promotes universal health care, found health insurance costs in Ohio rose 8.4 times faster than earnings from 2000 to 2006. Nationally, the report found insurance premiums grew 6.4 times faster than median earnings.

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The amount Ohio workers and employers must pay for family health insurance premiums has risen 73.3 percent over the six years, about the same as the national average. Individual premiums in Ohio have increased 73.8 percent, more than the national average of 64.1 percent.

The average median income in Ohio, meanwhile, went up only 8.7 percent during the same period — shy of the national earnings increase of 11.6 percent, Families USA found using U.S. Census, Labor Department and Health and Human Services data.

"If earnings continue to lag behind fast-rising health care costs, Ohioans will face diminishing economic and health security," said Ron Pollack, executive director of Families USA. "It is high time for national leaders to address this growing problem and make it a top national priority."

The Families USA findings are similar to a national survey in September by the Kaiser Family Foundation, which found health insurance premiums had risen 7.7 percent in the past year. That was the slowest rise since 1999, but still more than twice the rate of inflation.

John Baker, the owner of Diamond Tool and Die in Dayton and an active Republican, said his 30-employee manufacturing shop is faltering under the weight of rising premiums, even after his workers agreed to pay 15-percent of premiums.

"It's unsustainable; we can't keep on like this," he said. "If an employee works 2,000 hours a year, that's $6 an hour we pay for his health benefit. We're told we have to be innovative so we can compete with the Pacific Rim competition. Well, those people don't have a $6-an-hour cost in their whole process."

JoAnn Volk, health care lobbyist for the AFL-CIO, said there are many employers who want to keep providing reasonable health care benefits, but Republican leaders in Washington have been pushing high-deductible health plans to replace traditional premium-based plans.

"Employers who are doing the right thing are increasingly at a competitive disadvantage," she said. "Unfortunately, we haven't seen employers leading the way, but if there were a different direction coming out of Washington, we might be able to fix this."

That different direction supported by the union and Families USA is socialized medicine in the mold of the Canadian and Western European systems.

Baker is desperate, but he's not ready to go that far.

"I don't think they work as well as the American system, it's just ours is becoming too costly, and I don't know what to do about that," he said.

Families USA: http://www.familiesusa.org

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