Excerpted from Understanding the Uninsured and What to Do About Them, by the Council for Affordable Insurance, March 2007–the first of a several-part series.
Every year, the U.S. Census Bureau reports the number of uninsured has grown–reaching 46.6 million Americans in 2005. However, the focus on the number or percentage misses the point entirely. Before elected officials look for solutions, it is even more important that they understand who the uninsured are and why they lack coverage.
With that information in hand, elected officials may be able to identify cost-effective ways to help the uninsured gain access to affordable health insurance coverage.
Many health policy experts have raised questions about whether the Census Bureau’s methodology of tracking the uninsured is accurate, speculating that it over-counts the number of people without coverage.
That’s because the Census Bureau uses a “point in time” approach. That is, the uninsured number represents how many people lack coverage on any given day. And while there still may be about as many uninsured a month later, it won’t be exactly the same people, since some will have gotten coverage and others will have lost it. It doesn’t identify the chronically uninsured.
In addition, the Census Bureau survey depends on respondents accurately remembering whether they had coverage at some point over the past year. For example, some respondents apparently don’t realize that participating in Medicaid, the federal-state health insurance program for the poor, qualifies as coverage.
Recently, several states have conducted their own surveys and found their uninsured rates are lower than those reported by the Census Bureau.
For example, when Massachusetts conducted its own survey of the state’s uninsured, it found roughly 7 percent (460,000 out of a population of 6.4 million) were without coverage–much lower than the 10.7 percent estimated by the Census Bureau.
Thus, while the Census Bureau’s numbers on the uninsured may be the best we have, there has been a longstanding concern about their accuracy.
Who Are the Uninsured?
Reformers and critics of the current health care system often treat the uninsured as if they all face similar circumstances. When we look at the different types of uninsured people, some of them fit the popular image of the uninsured as often portrayed in the media. However, many do not.
- The Temporarily Uninsured: Most people are uninsured for relatively short periods of time, usually as a result of job transition. The federal government estimates about 45 percent are uninsured for six months or less.
- The “Invincibles”: Certain advocates imply the uninsured population is made up of older people with medical conditions. In fact, the majority of the uninsured are young and, not coincidentally, healthy. According to the Census Bureau, 30.6 percent of the uninsured are between 18 and 24 years old, and another 26.4 percent are between 25 and 34.
- Low-income Individuals: Income is one of the most important predictors of who has coverage and who doesn’t. The Census Bureau estimates that of those with incomes less than $25,000, 24.4 percent are uninsured, while only 8.5 percent of those with incomes above $75,000 are uninsured.
- No Access to Employer-Provided Coverage: About 80 percent of the uninsured have a job or live in a household where someone works. In most cases they are lower-income workers for employers that don’t offer health insurance.
- The Chronically Ill: The chronically ill have been the focus of many state policymakers. To provide access to health coverage for this population, 34 states have successfully implemented high-risk pools.
- Workers Facing Tax Discrimination: Federal tax policy discriminates against people who buy their own coverage in the individual health insurance market.
- The Working Poor: One study from the journal Health Affairs found roughly 18 percent of employees who were offered coverage declined it, and they usually do so because they can’t afford the employee portion of the premium.
- Voluntary Opt-Outs: About 17 million Americans have good incomes but choose not to obtain insurance coverage. The number of uninsured Americans at those higher income levels is now rising significantly faster than among those at lower income levels. In addition, about 25 percent of the uninsured are eligible for a government insurance program but don’t enroll.
- Minorities: While the Census Bureau reports whites have an uninsured rate of 11.3 percent, blacks and Hispanics face much higher uninsured rates–19.6 percent and 32.7 percent, respectively.
No Single Solution
Elected officials too often focus on solving everyone’s problems with a single solution. As we have shown above, however, the uninsured are very diverse.
The solution for someone already eligible for Medicaid but not enrolled is different from the solution for the uninsured family with income in excess of $75,000. In the next installment of this series, we’ll focus on targeted solutions for specific problems of the uninsured.