After the longest economic recovery in US history, we’ve been expecting a recession for a long time. We knew when it came, Connecticut healthcare would be hit hard. But no one expected this.
Economists agree that this recession will be deep but no one knows how long it will last. Connecticut didn’t fare well in the last recession and we took longer than other states to build back the jobs we lost. It’s not clear that our economic foundations are any better now. At the same time, the healthcare capacity we need to recover from this pandemic is stretched and healthcare workers are at risk.
The economic news is terrible and hitting Connecticut’s low income residents and small businesses the hardest. Homeless shelters and food pantries are struggling to keep up with demand. Nonessential businesses are closing and many that are still open are empty. Consumers are told to stay home.
Layoffs and furloughs have pushed up Connecticut unemployment to 400 times the usual rate. Three in five Americans live paycheck to paycheck. It’s expensive to live in Connecticut – we are 43rd among states in how far our paychecks go. Federal and state stimulus packages will help but they won’t solve the problem. Paid sick leave will help those who are sick and employed, but that doesn’t help healthy, laid-off workers.
In addition to losing jobs, the unemployed often lose access to health coverage. Thanks to the Affordable Care Act, Connecticut’s uninsured rate dropped by almost half since 2011, but that’s not going to last.* It’s great that AccessHealthCT has opened the exchange, but without a paycheck it won’t be affordable for many. More uninsured means more patients who can’t pay their bills. Rising uninsured during a pandemic is a double whammy.
One in eight Connecticut workers are right at the front line of this crisis working in healthcare. Exposure to the virus by the nature of their jobs, shortages of protective gear, not enough Covid-19 tests to determine who can return to work, and figuring out childcare while schools are closed are all piling on top of primary care provider shortages we’ve had for years. Usually having a state workforce weighted toward providing healthcare is a hedge against a recession, but not if the recession is caused by a pandemic.
Connecticut’s state budget is going to take a hit. Because people are out of work and the stock market is in free fall, income taxes will drop. Because businesses are closed, sales and business taxes will decline. Together personal income, business, and sales taxes make up 79% of Connecticut’s revenue.
Just as revenues are down, demands on the state budget will increase. Connecticut Medicaid rolls increased by 177,000 in the last recession, far more than the increase from the Affordable Care Act expansion. State government pays for a lot of healthcare and treatment for Covid-19 is not cheap. Public health crises are very costly for both state and local government.
Last year we didn’t know where the next recession was going to come from. I said we should hope for the best and prepare for the worst. I hope we’re ready.
Ellen Andrews, PhD, is the executive director of the CT Health Policy Project. Follow her on Twitter @CTHealthNotes.
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