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Health costs wiped out a whole decade of income increases

A new study in the journal Health Affairs shows that while Americans are making more money, nearly all of that extra income is going towards the increased cost of health care:

Overall, that middle-income family saw its income go up by $23,000, from $76,000 in 1999 to $99,000 in 2009 — not too bad. But rising health-care costs, in the form of increased insurance premiums and co-pays, ate up nearly all of that. Factor in that spending, and the average family only had $95 per month more in available income than it did a decade ago.

This picture could look a lot different. If health costs grew just 1 percent faster than inflation, for example, the same family would have $335 more in available earnings each month. Get health costs to keep pace with inflation and you’re looking at a $545 bump in monthly income (ignore the blue bars):

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