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September 2012
THE UNINSURED AND THE DIFFERENCE HEALTH INSURANCE MAKES
In 2011, almost 48 million nonelderly Americans were uninsured, amidst a slow economic recovery (Fig. 1). While public insurance
covers many who would otherwise be uninsured, Medicaid and the Children’s Health Insurance Program (CHIP) do not reach all of those
who cannot afford insurance. The 2010 Affordable Care Act (ACA) seeks to address the gaps in our private-public insurance system by
expanding Medicaid, providing subsidized private coverage for individuals with incomes up to 400% of poverty, and reforming the
health insurance marketplace.
Figure 1
During the recession that began in 2007, millions of people—
primarily adults—lost insurance coverage and joined the ranks of
the uninsured. The number of uninsured declined in 2011, the first
decrease in four years. Still, 18% of the nonelderly population was
uninsured in 2011, which puts their health and financial security at
risk.
WHY ARE SO MANY AMERICANS UNINSURED?
Health insurance is expensive, and few people can afford to buy it
on their own. Most Americans obtain health insurance coverage
through an employer. However, not all workers have access to
employer-sponsored coverage. Low-income workers—those at
greatest risk of being uninsured—are less likely to be offered jobbased coverage and less able to afford their share of the premiums
than workers with higher incomes. The ACA includes additional
employer incentives to provide affordable coverage.
Number of Nonelderly Uninsured,
2007-2011
Children (0-18)
Nonelderly Adults (19-64)
In Millions:
43.4
44.2
8.6
7.8
34.9
36.4
2007
2008
48.3
49.2
47.9
8.1
7.9
7.6
40.3
41.2
40.3
2009
2010*
2011*
* Applied Census 2010-based population controls.
NOTE: May not sum to totals due to rounding.
SOURCE: KCMU/Urban Institute analysis of 2009 through 2012 ASEC Supplement to the CPS. Holahan J and Chen V. “Changes in Health Insurance
Coverage in the Great Recession, 2007-2010.” Kaiser Commission on Medicaid and the Uninsured. December 2011.
Medicaid covers many low-income children, but coverage for adults is currently more limited. Parent income eligibility levels remain
very low in many states, and unless they qualify through a disability eligibility pathway, adults without dependent children are not
eligible for coverage in most states, regardless of their income. The ACA provides for an expansion of Medicaid for adults with incomes
at or below 138% of poverty ($35,038 for a family of three in 2012). If all states implement the Medicaid expansion, eligibility would
increase in nearly 40 states for parents and in nearly every state for other adults. If a state does not expand Medicaid, poor adult
residents will be left out of coverage.
Figure 2
The likelihood of being uninsured varies by state because of
differences in employment, income, and public insurance
programs’ eligibility levels (Fig. 2). Uninsured rates vary more than
four-fold across states (ranging from 5% in Massachusetts to 27% in
Texas), with states in the South and West having some of the
highest uninsured rates.
WHAT EXPLAINS THE TREND IN THE UNINSURED?
The recent recession and ongoing weak job market led to a steep
rise in the uninsured between 2007 and 2010. This trend was
driven by a decline in employer-sponsored coverage that resulted
from the high jobless rate. In January 2011, the unemployment rate
was 9.1%, close to double the rate in December 2007 when the
recession began. Throughout 2011, the unemployment rate
improved slightly. In the same year, the uninsured rate declined
slightly, in part due to stability in employer-sponsored coverage.
Uninsured Rates Among the Nonelderly
by State, 2010-2011
WA
VT
MT
MN
OR
ID
NV
WY
SD
UT
CO
CA
WI
PA
IL
KS
OK
NM
TX
IN
MO
LA
OH
WV
KY
MS
AL
VA
CT
NJ
DE
MD
RI
DC
NC
TN
AR
NH
MA
NY
MI
IA
NE
AZ
ME
ND
SC
GA
FL
AK
HI
<14% Uninsured (13 states and DC)
14-18% Uninsured (20 states)
>18% percent (17 states)
SOURCE: KCMU/Urban Institute analysis of 2012 ASEC Supplement to the CPS.
Medicaid and CHIP have been crucial to preventing steeper drops in insurance coverage, as many Americans became newly eligible for
these programs when their family income declined during the recession. These programs now cover 17.6% of the population under age
65 and have been key to protecting children from the full effects of the weak economy. The continued availability of public coverage
amid these difficult fiscal times reflected provisions related to federal assistance that were continued in the ACA for states to maintain
their Medicaid and CHIP eligibility levels until the broader coverage expansions go into effect.
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WHO ARE THE UNINSURED?
The majority of the uninsured are in working families. About six in ten of the uninsured have at least one full-time worker in their family
and 16% have only part-time workers (Fig. 3). Uninsured workers are more likely than insured workers to have low-wage or blue-collar
jobs and to work for small firms or in service industries.
Low-income individuals make up a disproportionately large
share of the uninsured. Close to 40% of the uninsured have
family incomes below the federal poverty level ($22,350 a year
for a family of four in 2011). Nine in ten of the uninsured have
family incomes below 400% of poverty and could receive
Medicaid or subsidized coverage under the ACA.
Aside from the elderly, who are almost all covered by Medicare,
the uninsured population is composed of all age groups.
Recently, the uninsured rate among young adults has improved
slightly due in part to the ACA provision allowing them to remain
on a parent’s private health plan until age 26. However, young
adults continue to have one of the highest uninsured rates
among the age groups. Children have the lowest uninsured
rate, and nearly two-thirds of uninsured children are eligible for
Medicaid or CHIP.
Figure 3
Characteristics of the Nonelderly
Uninsured, 2011
Family Work Status
Family Income
Age
400% FPL
and Above
251-399%
FPL
No Workers
22%
Part-Time
Workers
16%
1 or More
Full-Time
Workers
10%
14%
0-18
16%
<100% FPL
38%
62%
55-64
12%
19-25
17%
35-54
34%
100-250% FPL
26-34
21%
39%
Total = 47.9 Million Uninsured
The federal poverty level was $22,050 for a family of four in 2010. Data may not total 100% due to rounding.
SOURCE: KCMU/Urban Institute analysis of 2012 ASEC Supplement to the CPS.
WHAT DIFFERENCE DOES HEALTH INSURANCE MAKE?
Health insurance affects access to health care as well as a
person’s financial well-being. Over half of uninsured adults have no regular source of health care to go to when they are sick. Worried
about high medical bills, they are more than twice as likely to delay or forgo needed care as the insured (Fig. 4).
The safety net of community clinics and public hospitals is unable to fully substitute for the access to care that insurance provides.
Research has established that extending coverage to the uninsured improves physical and mental health, reduces mortality rates, and
ameliorates financial strain associated with health care costs.
Figure 4
Delaying or forgoing needed care can lead to health problems,
making the uninsured more likely to be hospitalized for
avoidable conditions. The uninsured are less likely than those
with insurance to receive preventive care and services for major
health conditions and chronic diseases—and as a result, many
suffer serious consequences.
The cost of health care has grown in the past decade, but represents
a particular challenge for those without insurance. Medical bills can
put great strain on the uninsured and threaten their physical and
financial well-being. Almost half of uninsured individuals reported
having trouble paying medical bills, compared to less than one in
four individuals with coverage. In addition, the uninsured are three
times more likely than the insured to be unable to pay for basic
necessities because of their medical bills.
Barriers to Health Care Among Nonelderly Adults by
Insurance Status, 2011
53%
10%
10%
No Usual Source of Care
Postponed Seeking Care Due to
Cost
Went Without Needed Care
Due to Cost
Could Not Afford Prescription
Drug
30%
12%
7%
Uninsured
26%
10%
Medicaid /Other Public
Employer/Other Private
4%
24%
14%
5%
In past 12 months.
Respondents who said usual source of care was the emergency room were included among those not having a usual source of care.
All differences between uninsured and insurance groups are statistically significant (p<0.05).
SOURCE: KCMU analysis of 2012 NHIS.
THE UNINSURED AND HEALTH REFORM
The ACA addresses barriers to acquiring insurance coverage through expanded access to Medicaid, subsidies for private insurance, and
health insurance market reforms. The majority of the coverage expansions in the ACA will take effect in 2014, at which point, there will
be a requirement that individuals have health insurance coverage. The law will also prevent insurers from rejecting individuals or
charging higher premiums based on health status. By 2016, the ACA is estimated to decrease the number of uninsured by nearly half,
leaving far fewer individuals facing the health and financial risks that come with being uninsured.
This publication (#1420-14) is available on the Kaiser Family Foundation’s website at www.kff.org.
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