WASHINGTON - (KRT) - The number of Americans who lack health insurance rose to 41.2 million in 2001, due mainly to a recession-fueled decrease in the number of workers with coverage from employers, the Census Bureau reported Monday.

Combined with rising medical and prescription drug costs and state government spending cuts, the trend of eroding personal health care likely will worsen before it improves, experts say.

"There is a crisis," said Leighton Ku, a senior fellow at the Center on Budget and Policy Priorities, a liberal Washington think tank. "The economy is stumbling, unemployment rose sharply in late 2001, health care costs are soaring and it's making it hard for companies to offer coverage to employees, and its making it harder for employees to pay their premiums, which are also rising."

Overall population growth helped increase the number of people with health insurance by 1.2 million, to 240.9 million last year, according to new Census Bureau figures. But the proportion of Americans without coverage grew from 14.2 percent in 2000 to14.6 percent last year.

"The percentage of people covered by employment-based health insurance dropped a (percentage) point, to 62.6 percent in 2001. That was the principal cause of the overall decrease in health insurance coverage," said Robert Mills, who wrote the annual Census Bureau report.

An additional 1.5 million adults lost private health coverage in the first quarter of this year, according to new survey data Ku cited from the Centers for Disease Control.

Many adults who lost private coverage due to layoffs and job losses enrolled in Medicaid, the public health insurance program for the poor. As a result, Medicaid enrollment increased from 29.5 million people in 2000 to 31.6 million people in 2001. New CDC data shows an additional 1 million adults enrolled in Medicaid in the first quarter of 2002, Ku said.

But cash-strapped states are cutting Medicaid services and restricting eligibility, which is likely to leave more poor people without coverage.

The figures from the U.S. Census Bureau are the latest to detail the suffering caused by the nation's recent economic slowdown. Last week, the bureau reported that the number of Americans living in poverty jumped to 11.7 percent - 32.9 million people - in 2001, while median family income dropped $900 to $42,228.

People earning $75,000 a year or more had the largest percentage increase in uninsured rates, according to the Census data. In 2000, 5.8 million, or 7.1 percent, of earners in that income group were uninsured. Those figures jumped to 6.6 million, or 7.7 percent, in 2001, showing that the recession took its toll on white-collar workers.

People earning less than $25,000 were in the income group likeliest to lack coverage, with 23.3 percent uninsured.

Most of the newly uninsured lived in the South and West, which could reflect growing immigration in those areas, said John Holahan, director of the Health Policy Center at the Urban Institute. The Northeast and Midwest showed only modest increases in uninsured population.

Hispanics, the fastest-growing segment of the nation's population, were far more likely than any other racial or ethnic group to be uninsured. About 12.4 million, or 33.2 percent of all Hispanics, were uninsured last year, compared with 6.8 million, or 19 percent, of blacks. About 18.2 percent of Asians and Pacific Islanders (nearly 2.3 million people) were uninsured in 2001, and 10 percent, or 19.4 million non-Hispanic whites.

A national survey released earlier this month by the Kaiser Family Foundation showed employer health-care costs are up 12.7 percent this year, the biggest increase since 1990.

Nationally, the survey found that the average insurance premium for a family of four increased 13 percent to $7,954 in 2002, up from $7,053 in 2001. Coverage for individuals increased by 15 percent, from $2,650 in 2001 to $3,060 in 2002, according to the survey.

While the coverage rates for employees of large companies were unaffected by the recession last year, health coverage fell by 100,000 employees at small companies with 25 or fewer workers.

The plight of the uninsured has renewed calls for universal health care, a proposal that former President Bill Clinton unsuccessfully championed during his first administration. Leading the call is Sen. John Breaux, D-La., a moderate Democrat who has been meeting with a variety of advocacy groups, think tanks, business and labor groups to discuss the issue.

Rather than force all employers to provide coverage as Clinton proposed, Breaux wants Congress to pass a law that would require adults aged 18 and over to purchase health coverage. The payments could be deducted from their paychecks and the government would help pay for those who could not afford it.

Details of the proposal have not been worked out, and Breaux said action is years away. But he said something must be done to address the health care crisis.

"We have to fundamentally change the health care system in this country," Breaux said. "The current system is in chaos and it's getting worse."

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© 2002, Knight Ridder/Tribune Information Services.