Senator Eliot Shapleigh - El Paso, Texas

A blue ribbon task force looking at access to health care heard today about the many misconceptions that exist over who in Texas is uninsured.

Dianne Longley, special projects director at the Texas Department of Insurance, said many people would be surprised to learn that most of the uninsured have jobs and are legal United States citizens. She said the numbers are growing.

"We are seeing a lot more middle income families without health insurance," Longley said, explaining that 28.1 percent of those uninsured in 2003 had incomes 250 percent above the poverty level or higher.

Another misconception, Longley said, was that reducing mandated benefits would lower the cost of health insurance. In a power point presentation applauded by the task force, Longley said that as a percentage of total claims, mandated benefits accounted for 4.51 percent in 2003.

"If you start to get rid of mandated benefits it won't really change things," Longley said.

The seminar, Access to Health Care in Texas - Challenges of the Uninsured and the Underinsured, was held by a task force set up by Texas' ten academic health-related institutions and non-health institutions. The task force expects to issue a report in a year's time.

TDI's research was made possible by a $1.3 million grant from the U.S. Health Resources and Services Administration in 2001 and an additional $175,000 awarded in 2003. Congress mandated that states collect data, conduct in-depth analysis of the uninsured population, evaluate options for expanding coverage and reach consensus on ideas to pursue.

Longley said TDI conducted in-depth telephone surveys of the non-poor uninsured - i.e., those earning 200 percent above poverty. The agency also surveyed small employers and held health insurance fairs and focus groups across the state. TDI found that small businesses are overwhelmed by the paperwork and the time it takes to handle health insurance.

Longley said it was "easy to get discouraged" by Texas' high rate of uninsured. Currently, the rate is estimated to be between 25 to 28 percent, compared to a national average of 15 percent.

Breaking the numbers down by age, Longley said the percentage of 0-17 year olds uninsured fell between 2000 and 2003, probably due to the Children's Health Insurance Program. She said the percentage uninsured aged 25-34 rose from 17.3 percent to 24.6 percent over the same period.

Of those uninsured in 2003, Longley said 59 percent were Hispanic, 29.7 percent were Anglo/other, and 10.2 percent were African American. Also in 2003, 68.1 percent of the uninsured were native U.S. citizens, 4.5 percent were naturalized U.S. citizens and 27.4 percent were non-U.S. citizens.

The explanations as to why Texas has such a high rate of uninsured could be lower average wages, Longley said, a higher proportion of small businesses, lower participation in public programs, lower participation in employer-sponsored programs, a higher proportion of non-legal citizens and low union participation.

Longley said Texas falls behind other states with large low-income populations, such as Arkansas and New Mexico, because there is lower rate of government-based insurance.

TDI also found that Texas has seen a decreasing rate of employment-based coverage, from 56.5 percent in 1998 to 52.4 percent in 2003. Longley said a likely explanation was increased costs. She said the average single premium, covering large and small employers alike, was $4,138 in 2004. The average family premium was $11,196. The rates are even higher for high-risk small employers, Longley said.

When TDI asked how much small employers could afford, 20.3 percent said $100 per employee, per month. When asked if they could afford $150, only 7.8 percent said yes.

Longley said factors contributing to increased costs included prescription drugs, hospital costs, new technology, along with an aging population and a sicker population. She said increased per-capita medical spending attributed to obesity between 1996 and 1998 accounted for 37.7 percent of private insurance, 39.1 percent of Medicaid and 36.8 percent of Medicare. She said Texas was estimated to be spending $5.34 billion in medical costs on obesity.

Longley said a few sick people account for most health care expenditures, with five percent of the people accountable for 50 percent of the costs and 15 percent of the people accountable for 90 percent of the costs.

In conclusion, Longley said private insurance is only part of the answer to the state's lack of health care. She said she envied the task force's freedom to explore the issue without restriction and urged the panel to be willing to take punches and let the chips fall where they may.

Lt. Gov. David Dewhurst also spoke at the seminar. He said that if lawmakers fixed public school finance, there could be more money to offer as an incentive for employers that offer health insurance to their employees. Dewhurst said increased costs had brought Texas' health care system close to crisis.

University Task Force Chair Neal Lane said TDI's findings would surprise many. Lane said if more people realized that they might be living next door to someone without insurance there might be broader support for action.