How Many Americans Are Uninsured … and for How Long?

Published July 1, 2003

The figure most often cited as an estimate of the number of uninsured Americans–41 million–may be over-stated by 10 to 20 million, according to the Congressional Budget Office (CBO). Many experts fear policymakers relying on the wrong data could improperly reshape our health care system, leading us to a one-size-fits-no-one single-payer health care plan.

After reviewing data from several sources, the nonpartisan CBO estimates 21 to 31 million Americans go without health insurance for 12 months or more. At least 59 million may be uninsured at least briefly in a given year, the report concluded. (See “Advocacy Groups Inflate Number of Uninsured,” Health Care News, May 2003.)

Moving Target

Douglas Holtz-Eakin, director of the CBO, explained, “There are two problems, short spells and long-term uninsurance. There is no such thing as the typical uninsured.”

The commonly cited estimate of 41 million uninsured comes from the Census Bureau’s Current Population Survey (CPS) and is based on a large national sample, not an actual head count.

Data from three federally sponsored national surveys–the Survey of Income and Program Participation (SIPP), the Medical Expenditure Panel Survey (MEPS), and the National Health Interview Survey (NHIS)–provide estimates of the number of uninsured at a particular point in time. All three agree that at a specific point in time during the year, roughly 41 million Americans are uninsured.

But SIPP and MEPS data show a far smaller number–21 to 31 million people–are uninsured for an entire year. (See Figure 1.)

A third measure of the uninsured is the number of people who lack insurance at any time during the year. At around 59 million, the figure includes people who are uninsured for only part of the year plus those uninsured throughout the year.

About 30 percent of non-elderly people who become uninsured in a given year remain so for more than 12 months. Nearly 50 percent regain health insurance within four months. Long uninsured spells occur less frequently than do short spells.

Prone to Error

Population surveys are prone to reporting and statistical errors, and the data derived from them are inherently unreliable. Controversy regularly attends reports from the decennial Census Bureau surveys for exactly that reason.

Some segments of the population may be under-represented in surveys, leading to the possibility of an undercount of the number of uninsured. Over-stating is also a possibility, if estimates are extrapolated from samples that are too small or insufficiently representative of the population as a whole.

Even when populations are properly surveyed, their answers may not be accurate. Misstatements, intentional or not, plague population surveys.

Researchers who compared data from the Centers for Medicare and Medicaid Services with the Center for Disease Control’s monthly Behavioral Risk Factor Surveillance Study concluded, for example, that some Medicaid recipients will say they don’t have insurance coverage, when in fact they do.

There is evidence respondents to surveys about insurance coverage do not count government-provided health plans as insurance. The perception is understandable: Persons covered by such insurance pay no premiums, make little or no co-payments for care, and receive no evidence of having an insurance policy.

Moreover, some people counted among the uninsured are eligible for insurance–Medicaid and the State Children’s Health Insurance Programs, for example–but have not applied. Some are unaware those programs exist.

Some policymakers believe such people should be regarded as insured, because they can apply for Medicaid when they need it and can receive retroactive coverage for their expenses. Others believe such people should be regarded as uninsured because they do not use Medicaid for their routine medical care. In any event, passing a new government insurance program is unlikely to make a difference for these “uninsured.”

Uninsured Still Have Access

Roughly 9 million documented and undocumented aliens are generally included in the uninsured estimates. Many of them have access to the private health care system, some without paying at all or by paying cash in an effort to remain anonymous. Many hesitate to participate in a government-program that could establish a paper trail for immigration authorities. Cultural mores, folkways, and language barriers also conspire to keep these people uninsured.

Persons without insurance or the cash to pay for care may have insufficient access to the most appropriate care, and they may be exposed to significant financial risk when they do get care. Nevertheless, they are not without access. Public and private hospitals, community health centers, local health departments, free clinics, faith-based programs, emergency rooms, and Department of Veterans Affairs facilities provide billions of dollars’ worth of care to the uninsured every year.

Policy Implications

Far from being a static group, the uninsured population is constantly changing. Some people are uninsured for long periods, but more are without coverage for shorter periods: when they are between jobs, graduating from college, or being discharged from military service.

Health care reform policies aimed at reducing the uninsured rate are most likely to be effective if they take into account the different implications of short-term and long-term periods of uninsurance and the different reasons for being uninsured.

To aid people with short uninsured spells, appropriate policies might include time-limited premium support for private temporary health insurance plans, aimed at filling a temporary gap in coverage or preventing a gap from occurring.

To assist those who go for longer periods without insurance, appropriate policies might provide or facilitate an ongoing source of coverage, such as continuing premium support or tax credits for portable medical savings accounts.

Conrad F. Meier is managing editor of Health Care News. His email address is [email protected].