NC employed, unemployed may both face no insurance

North Carolina's unemployment rate, already at its highest level in the three-decade history of jobless records, is forecast to keep climbing for the rest of this year, cutting off employer-subsidized health insurance coverage for tens of thousands of workers.

But thousands more who manage to hold onto their jobs may lose their insurance anyway as premiums push small businesses into a choice between offering health care or laying off employees. Other workers may see deductibles rise so high they'll be able to count on their insurance for little more than catastrophic emergencies, said Dr. Kevin Schulman, a physician who directs the health sector management program at Duke University's Fuqua School of Business,

Rising unemployment will "increase the number of uninsured going forward and will increase the number of people who can't afford to use their insurance," Schulman said Monday. "It's going to have an impact on people in North Carolina, an impact on people who lose their insurance, an impact on people who work for small employers, and on small employers to create new jobs going forward."

Less than half of the state's small companies are able to afford health insurance coverage for their workers, said Gregg Thompson, state director of the National Federation of Independent Business, a trade group that represents about 7,500 small-business owners. That's down from about six in 10 North Carolina firms with fewer than 50 workers in 2006, according to the North Carolina Institute of Medicine.

Small companies that continued coverage this year were hit with premiums that were 40 percent to 300 percent higher than last year, Thompson said.

"I have heard some of them (employers) say that if they are able to keep their insurance they have to cut hours back on their employees because (insurance is) the top expenditure in the business," Thompson said. "They're cutting where they can to balance their books when the premiums go up like they have."

One example of the hard choices for small business is Charlotte Post Publishing Co., which publishes newspapers in Charlotte and the Triangle that focus on black communities. Premiums for the 15-employee operation rose 24 percent last year, leaving publisher Gerald Johnson facing a dilemma.

"We're either going to have to start laying off people or get rid of health care," Johnson told Gov. Beverly Perdue and the Obama administration's top health care reform aide at a health care forum last week in Greensboro. The forum was one of five being held around the country as the Obama administration draws attention to getting health care reform approved in Congress this year, with the ultimate goal of universal coverage.