Numbers of Uninsured Grow Ominously

The World and I, October 2004 | Go to article overview
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Numbers of Uninsured Grow Ominously

It's the economy--because the latest numbers on the uninsured in America, released recently by the U.S. Census Bureau, were not as high as some analysts had feared and they can be tied to a weak 2003 economy.

Republicans will spin that 1 million more people got health insurance in 2003, and the Democrats will counter that 1.4 million more people lost coverage--and they both will be right. Republicans will point to the success of the Bush tax cuts in stimulating the economy and Democrats will point to those same cuts and say they shortchanged the economy's ability to generate jobs.

Paul Fronstin, a researcher at the Employee Benefit Research Institute in Washington, said the most important thing to look at is the percentage change--the ranks of the uninsured grew from 15.2 percent of the population in 2002 to 15.6 percent in 2003--because the actual numbers are driven by population growth. It is possible that all 1.4 million people who joined the uninsured in 2003 were due to population growth--but that is not the case.

That 0.4 percent, Fronstin said, represents a rate of increase "a little slower than in 2001-2002 ... but not much different than in the past. We've been seeing a half-percent increase--give or take--on a year-to- year basis," he noted.

Daniel Weinberg, the Census Bureau's chief of Housing and Household Economic Statistics, told reporters in releasing the numbers the uninsured rate from 1987 to 1998 either stayed the same or went up, peaking at 16.3 percent in 1998. After that, the rate dropped two years in a row and then bottomed out at 14.2 percent in 2000. Since then, it has been moving up again.

An e-mail from Karen Davis, president of the Commonwealth Fund, pointed out the increase in uninsured is mostly among adults and "the vast majority work," she said. "The numbers of uninsured workers increased from 25.7 million to 26.6 million from 2002 to 2003--an increase of close to 1 million uninsured working Americans," she added.

The employment factor hits at the crux of the statistics. People lost jobs in a struggling 2003 economic recovery and therefore lost health insurance. "If they found a new job, it probably didn't come with insurance or it came with insurance and maybe it cost too much to buy in to," Fronstin suggested. There also has been a move away from manufacturing jobs--historically good benefit providers--and fewer smaller companies offered employees health benefits in 2003.

Jared Bernstein of the Economic Policy Institute in Washington said, in response to a question during a briefing on the numbers, "a jobless recovery is all over these results." He said the weak labor market is a factor--and a public safety net that increasingly relies on work--along with problems in job quality, which affects benefits such as insurance.

Weinberg said the rates are "mostly explained by the decline in coverage from employment-based plans, partially offset by increases in government coverage."

Employment-based health coverage fell by 0.9 percent, while participation in Medicare and Medicaid increased by the same amount. The number of poor children added to Medicaid was the chief part of that program's 0.7 percent growth.

It also is important to understand why people are uninsured. Are people- -unemployed or working--too poor to afford coverage or, as the National Center for Policy Analysis (NCPA) in Dallas contends, do some--perhaps the younger and healthier--simply choose not to spend their money on insurance?

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