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Health insurance premiums spike for North Carolina families

by Sarah Costello,

Health care has been a popular issue in the news since President Barack Obama's campaign promises for reform. According to a White House report, health insurance premiums have skyrocketed during the past 10 months in North Carolina because of the economic recession.

Though premiums have been increasing since 2000, the recent jump in costs has hurt many businesses, employers and private citizens.

North Carolina families experienced dramatic health insurance premium increases during 2009 when the average annual family premium for health insurance sponsored by employers unexpectedly rose to $13,375 — a 5.5 percent increase attributed to the recent recession.

"The status quo of rising premiums is simply unsustainable for families, for businesses, for state budgets and for our national economy," said Vice President Joe Biden in a Sept. 22 White House press release.

According to Families USA, the voice for health care consumers, health insurance premiums have been rising steadily since 2000, while North Carolina wages have barely increased. Since 2000, health insurance premiums in the United States increased 96.8 percent while wages have only risen 18.4 percent, according to Families USA.

With thousands unemployed and little change in wage growth, employers and business owners must find methods of cutting costs by offering fewer benefits, disqualifying employees from coverage and omitting coverage of spouses and children. As a result, North Carolina families are paying higher premiums and receiving less for their money.

"Rising health care costs threaten the financial well-being of families in North Carolina and across the nation," said Ron Pollack, executive director of Families USA in an Aug. 18 press release. "If health care reform does not happen soon, more and more families will be priced out of the health coverage they used to take for granted."

Another underlying issue is the number of firms continuing to offer health insurance to clients. Families USA reports 6 percent of U.S. firms offering health insurance ceased to provide health insurance between 2000 and 2008. There is also an added risk that more families will be forced to file for bankruptcy as a result of medical debts. Medical bills contribute to half of U.S. bankruptcies, reports Families USA.

Biden met with State Insurance Commissioners on Sept. 22 to compile a new White House report about health insurance premium increases for North Carolina residents. The document can be accessed at www.whitehouse.gov.

"The State Insurance Commissioners understand firsthand the health care crisis and are fighting everyday to combat it and reduce unjustified premium increase," Biden said. "But these numbers are just one more piece of evidence that we need for nationwide reform."