Number and Growth of the Uninsured and Underinsured

Health insurance is crucial to most people for access to needed health care services. Lack of insurance is associated with delays in seeking care, noncompliance with treatment regimens, and poorer health outcomes. (Committee on Consequences of Uninsurance [2002]; Hadley [2002]) Approximately 18 percent of the non-elderly adult US population was uninsured in 1998 and just more than 16 percent in 2000 and 2001. (Fronstin [2002]) Children and the elderly have lower rates of uninsurance due to more comprehensive public programs for these populations (ie, State Children’s Health Insurance Programs [SCHIP] and Medicare). Our young adult, working poor, and Hispanic populations, however, bear a much greater burden of uninsurance than do other population subgroups. Some groups experience rates greater than 30 percent. For example, young adults have an uninsured rate of 30 percent; almost double that of the general non-elderly adult population and the Hispanics experience an uninsured rate of 32 percent. (Glied and Stabile [2001]; Mills [2002]) The probability of having health insurance coverage is related to employment status of the family, income, education, age, ethnicity, immigration status. Although public programs such as Medicare have greater expenditure toward health care, employers provide health insurance to more individuals than do public programs or individuals. Therefore, employment is strongly related to insurance coverage. Income, education and age also are positively related to the probability of being covered. The near-poor, individuals with incomes between 100 and 300 percent of the poverty level, have the greatest burden of uninsurance—and it is increasing. There is a disparity in health insurance coverage rates among ethnic groups. Hispanics, as mentioned, bear the greatest burden of uninsurance (32%). Coverage rates for White nonHispanics, Blacks, and Asians and Pacific Islanders were 90.3, 81.5, and 82.0 percent, respectively. Geographic variation exists among states, with the lowest uninsured rate being 6.9 percent (Rhode Island) and the highest 22.6 percent (New Mexico); variations that closely mimic income patterns among states. (Mills [2002]) Such relationships, particularly the strong dependence on employer-sponsored health insurance, point to the strong dependence of the uninsurance rate on our economy’s strength. Employers who experience market pressures do cut benefits, particularly among low-wage workers. These are the same workers who are most likely to experience difficulty retaining or obtaining a job during an economic downturn. Low-wage workers must often contribute higher proportions of the premium for less comprehensive coverage compared to workers who earn higher wages. Cost is the most common reason cited by the uninsured who turn down employer sponsored plans. These dynamics are mirrored in health insurance coverage patterns seen during the past decade—better economy, higher coverage rates. Working in tandem to the employers’ role in US health insurance coverage rates are the public programs. Recent policy changes, such as welfare reform and the SCHIPs impacted coverage rates among the poor. Uninsured rates for children have decreased to approximately 13 percent, but these rates vary among states. Tempering the enthusiasm for the SCHIPs, however, is the deep fiscal problems that states are currently experiencing. The SCHIPs are potential targets for reducing state budgets and the recent coverage increases may be temporary in some states. Welfare reform impacted the Medicaid programs in ways we cannot yet predict fully, although Garrett and Hudman (2002) found that the uninsured are for women who left welfare was 40 percent, much higher than the general population. Increases in employer-based coverage during the economic expansion of the late 1990s offset the decreased coverage available through Medicaid programs. As we analyze data for 2002 and 2003 we will better understand how those reforms impacted access to health care for those most at risk to economic downturns. There is the additional issue of underinsurance. Underinsurance has no agreed-upon definition, and this has hampered efforts to address it or study its impact. Some define it as an undue burden based on cost versus income, some as the percent out-of-pocket expenses of total medical expenses, and others look at the coverage offered by a plan. (Bartlett [2000];