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For healthcare (like so much else), the poor pay more

Vol 7 - No 5  (This article was originally published in print in the Minnesota Spokesman-Recorder on February 20, 2020)


"America’s healthcare system is neither healthy, caring, nor a system."

                                                                                   - Walter Cronkite

"Of all the forms of inequality, injustice in health care is the most shocking and inhuman."

                                                                                                 - Dr. Martin Luther King, Jr.


When it comes to the subject of health care, a common refrain from American families nowadays is, “Every year we pay more and more for insurance and yet somehow receive less in terms of coverage and benefits.”

For example, a colleague of mine recently mentioned that a decade ago, his insurance paid all but $75 of a $6,600 bill following a one-night stay in the hospital. But this past year, even though his annual premiums have continued to rise significantly, he was responsible for approximately two-thirds of a $2,900 bill after a three-hour visit to the Emergency Room (where it was determined nothing was wrong with him).

It’s no secret to anyone that healthcare costs have skyrocketed in the 21st century. According to the latest data from the U.S. Bureau of Labor Statistics, today Americans pay more than twice as much for health care as they did in 1984. And, those who in turn shoulder the greatest burden (at least proportionately) with regard to increasing costs are households with the lowest incomes.

In a newly published study in the Health Services Research Journal, senior researchers from the RAND Corporation reveal that the poorest 20 percent of American households pay more than one-third (roughly 34 percent) of their total annual income to cover healthcare costs. This is more than double what the wealthiest 20 percent of Americans pay in annual costs (16 percent), while those in the middle generally contribute somewhere between 20 and 23 percent of their yearly earnings toward health care.

RAND’s research team, led by economist Katherine Grace Carman, recognize that Americans in the top income tier “pay more into the system” than others, often more than they receive back in healthcare services. That said, the disproportionate weight carried by low-income households relative to healthcare costs is often crippling. Carman states, "Our findings suggest that healthcare payments in the United States are even more regressive than suggested by earlier research. As national discussions continue about health reform and health equity, it’s important to understand how the current healthcare system distributes costs and payments.”

The inequity that America’s poorest families are saddled with in healthcare costs are, percentage-wise, rather comparable to the amount that is spent on housing costs. So if a family is dedicating 70 percent or more of its annual income to just those two things, how can they possibly afford to meet all of their other basic needs—food, transportation, child care, utilities, and so on?

Moreover, about that debate on healthcare reform that Carman references, another expert healthcare analyst, Joshua Cohen, reports that the efforts to increase fairness and equity in the system are essentially “muddling along inelegantly.”

As a new presidential election year takes shape, Cohen acknowledges that there have been plenty of photo ops and no shortage of rhetoric but little if any real action, adding that America “is mostly stuck in the same place it was with a dysfunctional system of rebates and rising out-of-pocket costs for beneficiaries.”

When speaking to both the disparities in healthcare costs and services, particularly along racial lines, our state still has a lot of work to do. Minnesota has consistently ranked among the top five states for health care when it comes to costs, access, and outcomes. But these impressive numbers do not hold true for all Minnesotans.

All the way back in 2001, the state legislature created the Eliminating Health Disparities Initiative (EHDI). In the ensuing years, the Minnesota Department of Health (MDH) and its partners established a number of strategies.

In 2014, in the wake of numerous reports that detailed continuing inequities in health, MDH Commissioner Edward Ehlinger introduced a new strategy titled Advancing Health Equity in Minnesota. And while data from the state’s most recent health equity report shows some progress, considerable healthcare gaps still remain.

The nonprofit Minnesota Community Measurement, in releasing this report, notes that “In general, quality measures for American Indian, African American, and Hispanic Minnesotans are significantly below the state-wide rate on most measures.” This data also highlights similar disparities among the state’s immigrant communities.

Health care is and always will be one of the most critical issues in America. While some improvements have been made and more people have access to care than, say, 10 years ago, increasing costs and other injustices persist. As with housing, education, and a multitude of other things, people of color and the poor continue to bear the brunt.

Our Impact This Year

  • People Who Received Utility Bill Assistance


  • Children Enrolled in Head Start & Early Head Start


  • People Whose Utility Bills Were Lowered Through Home Weatherization


  • Workers Provided with Transportation Support Including Vehicle Loans, Repair Grants, and Transit Passes


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