NCPA - National Center for Policy Analysis

The Cost of the Uninsured

June 18, 2003

Some 41 million Americans are without health insurance for a period of time each year, and a new report from the Institute of Medicine attempts to measure the costs of having so many people uninsured.

The 22-member panel was asked to calculate the "hidden" costs of the uninsured. The committee is said to have used the same approach that federal agencies use to determine whether the benefits of taking steps to reduce a risk or harm justify the costs to society of implementing those measures. Among its findings:

  • Americans without health insurance costs the nation between $65 billion and $130 billion every year because of their poorer health and earlier deaths.
  • Each uninsured person loses the equivalent of between $1,645 and $3,280 annually in lost wages and benefits and in the value of what would be a better quality of life and a longer lifespan if the person were insured, the panel concluded.
  • The new estimate does not include the cost of the free or discounted health care that society provides to people without health insurance, which runs between $34 billion and $69 billion annually.

The institute's last report on the uninsured (May 2002) estimated that the lack of health insurance led to delayed diagnoses, life-threatening complications and 18,000 premature deaths each year.

Source: Rob Stein, "Toll of Health Insurance Gap Detailed," Washington Post, June 18, 2003; Institute of Medicine, "Hidden Costs, Value Lost: Uninsurance in America" (Washington: National Academies Press, 2003).

 

Browse more articles on Health Issues