ALBUQUERQUE, N.M. — A new report from the Commonwealth Fund has found that New Mexicans who get their health insurance through their employers have the potential for more burdensome out-of-pocket costs than workers in almost any other state in the country.
In 2017, the combination of average premiums and deductibles for workers in New Mexico totaled $6,652 annually, or the equivalent of 14.8 percent of the median income in the state. While the national average for such costs is higher at $7,240 per year, so too is the country’s median income. For the average American, the combination of premiums and deductibles is the equivalent of 12 percent of median income.
Only Louisiana at 15.5 percent and Mississippi at 15 percent have more burdensome potential costs than New Mexico, according to the Commonwealth Fund, a New York-based health care nonprofit.
David Radley, a senior scientist at the organization, said in an interview that New Mexico’s ranking is primarily a reflection of the state’s lower-than-average incomes.
“What’s interesting about New Mexico is that it’s total premium cost is pretty close to the national average,” said Radley. “Deductibles have risen a lot, but the overall cost is still a bit lower than average. But incomes in New Mexico tend to be lower than other parts of the country, and when health care becomes a larger share of what individuals and families are spending, that creates a big burden.”
Radley pointed to several policy recommendations that he said could alleviate the burden for New Mexicans. The first is addressing the so-called “family coverage glitch” in the Affordable Care Act. Under the legislation, employees whose premium expenses exceed 9.5 percent of their income are eligible for subsidies that make marketplace plans more affordable. But the formula takes into account only the cost of covering a single employee, not that employee’s spouse or other dependents.
As a result, according to Radley, many families — including thousands in New Mexico — are stuck with employer-sponsored health insurance they can barely afford because the marketplace plans are more expensive.
Among the other recommendations made by Radley and the report: mandating that insurers provide a larger swath of services at low or no cost to patients, and creating tax credits for Americans whose out-of-pocket costs exceed a certain percentage of their income.