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The Consequences of Insufficient Household Income

This new Consequences of Insufficient Household Income report provides a deeper level of understanding of the choices that ALICE and poverty-level families across the country make when they do not have enough income or assistance to afford basic necessities, and the consequences of those choices.

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average of $536 per month in 2014 – but it does not include the cost of health insurance. In addition, the Survival Budget includes the Affordable Care Act (ACA) penalty of $24 per month ($285 annually) for a family in 2014 – the least expensive legal alternative to premiums and a deductible. The total of $560 per month represents 30 percent of a nursing assistant’s monthly wages. Out-of-pocket costs are represented in the dark portion of each bar in Figure 9 (Bureau of Labor Statistics, 2014 and 2014a). • The cost of the premium ($44 per month) plus deductible ($372 per month) for the ACA Marketplace Silver Plan with subsidies for a family of four, on top of out-of-pocket health care spending, is $972 per month – 51 percent of a nursing assistant’s monthly wages (Kaiser Family Foundation, 22015; Rae et al., 2015). • Private insurance through an employer is another option for some workers. The national average premium for the employee at a private-sector job that offers health insurance and has 50 percent or more low-wage employees is $446 per month, as recorded by the Medical Expenditure Panel Survey (MEPS). When added to out-of-pocket costs, the total represents 52 percent of a nursing assistant’s monthly wages (Agency for Healthcare Research and Quality, 2015). • Insurance through the ACA Marketplace Silver Plan for a family of four is much more expensive when subsidies are not available. In fact, the cost for the premium increases to $932 per month, plus the cost of meeting the deductible, plus out-of-pocket expenses, for a total of $1,851 – 98 percent of a nursing assistant’s monthly wages (Kaiser Family Foundation, 2015). Strategy 1: Forgo Health Care Preventative Health Care. The most common way to try to save on health care costs is to forgo preventative health care, which can mean that a family does not visit a primary care doctor, take regular medication as needed, get vaccinations, eat fresh food, and adhere to other ways of maintaining a healthy lifestyle. For many ALICE households, doctor visits and medications are seen as too expensive. Studies across the country find that having a lower income reduces access to and use of preventative services, and this disparity is true even when a member of the household is working (Cohen, Kirzinger, & Gindi, 2013; Commonwealth Fund, 2013): • Nationally, children 19 to 35 months old whose families earn below the FPL are significantly less likely to have received all scheduled vaccinations than their higher-income counterparts (66 percent compared to 75 percent) (Centers for Disease Control and Prevention (CDC), 2015). • Women at or below the FPL are about one-third less likely to receive a mammogram than women in a household at or above 400 percent of the FPL (University of California, Davis, 2015). • Adults with low incomes are 14 to 26 percent less likely to receive cervical, breast, and prostate cancer screenings, cholesterol screening, and flu vaccinations than adults with higher incomes (Ross, Bernheim, Bradley, Teng, & Gallo, 2007). Dental Care. Skipping preventative dental care is even more common among ALICE families. Low-income adults are almost twice as likely as higher-income adults not to have had a dental check-up in the previous year. Children are at particularly high risk; fewer than half of low-income children without health insurance receive preventative dental care. These gaps in care have long-term health and financial consequences. A $48 sealant can block tooth decay for nearly five years, yet only 25 percent of low-income children receive them, leading to untreated decay. The income discrepancy exists for seniors as well: Thirty-five percent 62 UNITED WAY ALICE REPORT – THE CONSEQUENCES OF INSUFFICIENT HOUSEHOLD INCOME

of seniors living in poverty have had a dental visit in the last year, compared to 80 percent of seniors with incomes of $45,000 or higher (The Pew Charitable Trusts, 2016; Haley, Kenney, & Pelletier, 2008; Russell, 2015; Hinton & Paradise, 2016). Care for Mental Illness. One in five adults in the U.S. experiences mental illness in a given year, and four percent of adults experience serious mental illness, yet treatment rates remain exceedingly low: • National data from 2013 shows that fewer than 40 percent of adults who lived with mental illness received treatment. However, this represents an improvement from 2007, when only 17 percent of adults received treatment (National Alliance on Mental Illness, 2015). • Across the U.S., state government funding for mental health services was cut during and after the Recession, while demand increased. The result has been longer waiting lists for care, less financial assistance to help people with mental illness find housing and jobs, and more people visiting emergency rooms (ERs) for psychiatric care (National Alliance on Mental Illness, 2015; Aron, Honberg, & Duckworth, 2009; Glover, Miller, & Sadowski, 2012). • Recent national surveys find that 1 in 3 children and adults forgo mental health care because of cost. Even among individuals with private insurance, over half said that cost was the number one reason they do not seek mental health treatment (Center for Behavioral Health Statistics and Quality, 2012; Parity Project, NAMI-New York City Metro, 2003; Mojtabai, 2005; Mental Health America, 2015). Consequences More serious health problems: When health issues go untreated, they become more serious and lead to other poor outcomes for ALICE, including reduced school and work attendance and UNITED WAY ALICE REPORT – THE CONSEQUENCES OF INSUFFICIENT HOUSEHOLD INCOME 63

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