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More people are covered by health insurance – but health insurance covers less

Quantity does not equate to quality — especially when it comes to U.S. health insurance.

Here’s the good news: The number of Americans with health insurance is hitting historic highs.

And the bad news: The health insurance itself is inadequate.

According to recent findings from the Commonwealth Fund Biennial Health Insurance Survey, almost half of working-age adults are inadequately insured, with nearly a quarter “under-insured,” meaning that they have insurance, but it isn’t robust enough to ensure affordable access to healthcare.

Insured should just be insured, but apparently there are more gray areas than we think. So, how exactly is “under-insured” explicitly defined? As people who have insurance for the full year, but who meet one of the following criteria:

  • Their out-of-pocket costs (meaning any costs their insurance company chose not to cover) were 10% or more of their household income — not including premiums — or 5% or more for those living under 200% of the federal poverty level.
  • Their deductible (meaning the amount the patient must pay before insurance kicks in to cover costs) was 5% or more of household income.

To put it into real numbers:

In 2021, median household income was $70,784, according to data conducted by the United States Census Bureau. That same year, the average family deductible was $3,868 per month, per the Kaiser Family Foundation. This means that the average deductible in 2021 was nearly 5.5% of the median household income.

Meanwhile, profits are record-breaking in the millions. For Blue Cross Blue Shield of North Carolina (BCBSNC), for instance, the insurance company profited $569.3 million in 2021 — higher than its profits from the previous two years. And in 2022, insurers raked in so much cash that, they will have to return approximately $1 billion in rebates to consumers and employers.

When we break it down by the numbers, it’s crystal-clear that health insurance is simply not working for the average American. In contrast, the U.S. healthcare system is certainly set up to benefit insurers.

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