Covering the Uninsured in the United States

O of the major social policy issues facing the United States in the first decade of the twenty-first century is the large number of Americans lacking health insurance. While other industrialized nations guarantee universal health care for their citizens, 47 million persons in the United States, or 18 percent of the nonelderly population (the elderly are universally covered under the Medicare program), lack health insurance. As a result, the problem of the uninsured has been front and center in public policy debates and political campaigns for many years. The (failed) centerpiece of the early Clinton presidency was a plan for universal health coverage; fifteen years later, each of the major Democratic candidates for President is proposing a plan for universal health coverage. Of course, health insurance is not the only “merit” good that is not universally consumed by the American public: a larger number of U.S. households do not own their own homes, for example, than the number of households that contain uninsured individuals. While homeownership is viewed as a valid goal for families, there is little demand for universal ownership. With health insurance, however, a number of arguments are used to justify universal coverage: financial and physical externalities to others, inefficiencies in labor markets from limited job-related coverage, myopia among the uninsured, and income redistribution to lower income groups that tend to be uninsured. Regardless of the validity of these arguments, strong advocacy for universal insurance coverage is here to stay. Covering the Uninsured in the United States