Number of Uninsured Fell by Nearly Two Million in 2007

Published November 1, 2008

The number of uninsured U.S. residents dropped by almost two million people in 2007, according to the U.S. Census Bureau.

In 2006, 47 million people, or 15.8 percent of the population, were reported to be uninsured at some time during the year, with that number falling to 45.7 million people, or 15.3 percent of the population, last year.

The Census Bureau researchers used data from the annual Current Population Survey of the 50 states and Washington, DC in compiling their figures.

According to the Census Bureau, the number of Americans who were covered by a health insurance policy for all or part of the year grew from 249.8 million in 2006 to 253.4 million in 2007. About 8.1 million (11 percent) of U.S. children under 18 lacked insurance, down from the 2006 total of 8.7 million (11.7 percent).

Taxpayers Funding More

The number of people with private coverage and the number whose health insurance was sponsored by their employers each fell by 0.4 percentage points, with private coverage falling from 67.9 to 67.5 percent and employer-sponsored, which makes up 87.8 percent of the private health insurance market, falling from 59.7 to 59.3 percent.

While the percentages of private insurance policyholders were falling slightly, the proportion of Americans enrolled in taxpayer-funded plans rose slightly, from 27.0 percent in 2006 to 27.8 percent in 2007.

Ranking first among the states in percentage of insured population, with 92.1 percent covered, was Massachusetts, which recently hit its residents with an individual insurance mandate punishable by fine. Finishing last was Texas, with 75.6 percent of residents covered.

Although it increased the number of people who are insured, the system put in place in Massachusetts “tempts insurers to look for healthy customers and avoid sick ones, and thus to give more treatment to healthy ones and less to the sick,” said John Goodman, president of the National Center for Policy Analysis.

Government Program Rolls Swell

The Census Bureau attributed the decrease in uninsured Americans to an increase in enrollees in the State Children’s Health Insurance Program (SCHIP) and in Medicaid.

“The increase in the percentage of people covered through government-sponsored programs more than offset the drop in the proportion of people with private coverage, notably those with employer-based insurance,” David Johnson, chief of the Census Bureau’s Housing and Household Economic Statistics division, told Dow Jones magazine.

The number of taxpayer-funded health plan enrollees grew from 80.3 million in 2006 to 83 million in 2007.

SCHIP was extended at its current funding level through 2008 after President George W. Bush (R) twice vetoed attempts by Congress to expand taxpayer funding for the program and to allow adults and children from middle-income families to qualify for the program. Both of his vetoes were sustained in the House of Representatives.

States’ Policies Criticized

Insurance premiums that are rising faster than wages and inflation are to blame for Americans’ seeking insurance through government programs, say analysts, but they argue the reason for that is government itself, which spends too much time passing mandates and too little encouraging consumer choice and provider competition.

“State legislators can make significant headway in reducing the number of America’s uninsured by expanding choice and competition in the state health insurance markets,” said Nina Owcharenko, a senior health care policy analyst at The Heritage Foundation.

“The uninsured are not a homogenous population, so a one-size-fits-all solution won’t address everyone’s needs,” said J.P. Wieske, director of state affairs at the Council for Affordable Health Insurance.

“Some well-intended state reforms actually make the problem worse,” Wieske noted. “States play an important, often negative, role in determining whether residents have access to a wide range of health policies at affordable prices.”

Jeff Emanuel ([email protected]) is research fellow for health care policy at The Heartland Institute and managing editor of Health Care News.

For more information …

“Income, Poverty, and Health Insurance Coverage in the United States: 2007,” U.S. Census Bureau, August 2008: