Uninsured in America

schip-update.jpgThe number of people in the United States without any type of health insurance continued its steady climb in 2006, to 47 million uninsured. The share of the population without health coverage has grown over 2 percentage points since 2000, from 13.7% in 2000 to 15.8% in 2006 as per the reports by Economic Policy Institute.

Some analysts have argued that this increase is driven by the fact that there are more immigrants living in the United States, and that immigrants are less likely than native-born people to have health insurance. While both of these facts are true (the share of the foreign-born population increased 1.2 percentage points from 2000 to 2006, and the share of immigrants without health insurance was 20 percentage points higher over this period than that of native-born people), these facts are not driving the overall decline in coverage.

The decline in health insurance coverage continued unabated in 2006, driven primarily by the continued erosion in employer-provided health insurance.

In 2006, 2.3 million fewer Americans received health benefits from their employers than in 2000, the report said, noting the decline does not take the population increase into account.

Nearly 60 percent of the nation’s children are covered by the insurance provided by their parents’ employers, but 3.4 million fewer children had benefits in 2006 compared with 2000.

No category of workers was insulated from loss of coverage. Even full-time workers, workers with a college degree, and workers in the highest wage quintile experienced declines in coverage between 2000 and 2006.

These declines in coverage occurred across all lines: by age, sex, race, education, and household income level. But the loss of coverage was greater for men than women, as the coverage rate for working men with employer-provided insurance fell 4.9 percentage points compared to 2.9 points for women workers.

For jobholders, this was the sixth straight year of declines in health insurance coverage. The rate fell to just below 71 percent from nearly 75 percent in 2000.

Native Americans had the highest rates of insurance coverage from employers at almost 74 percent, though that was a drop of 3.5 percentage points. The rate for people born in other countries just topped 54 percent in 2006, 4.4 percentage points less than in 2000.

Whites had the highest rates of employer-provided health insurance, at 76.4 percent, though that was off 3.3 percentage points in the six-year period.

For blacks, the overall rate was nearly 66 percent, but off 2.6 percentage points from 2000. Hispanics had only a 48.4 percent rate of coverage, down 5 percentage points.

White-collar workers saw their coverage rates fall 3.5 percentage points to 61.4 percent. The drop for blue-collar workers was steeper, down 5.6 percentage points to 53.4 percent from 2000 to 2006.

The service sector’s rate fell 5 percentage points – and its employer-provided coverage rate was much lower at just under 29 percent.

Medicaid and the State Children’s Health Insurance Program (SCHIP)—have kept millions of families insured when their employment-based benefits were lost. Unfortunately, medical inflation and state budget constraints have weakened this safety net. Though the Congress has passed valuable legislation to strengthen SCHIP, however, President Bush vetoed their vote. Had the bill passed, 3.8 million more children would have been covered by health insurance.

Given the erosion of employer-provided health insurance and rising costs of medical care, now is a critical time to consider health insurance reform.

Namit Agarwal