Thursday, September 12, 2019

Uninsurance goes upscale: The Census's Health Insurance Coverage Update for 2018

Yesterday the Census Bureau* released its health insurance estimates for 2018. The top line showed a rise in the uninsured population of 1.9 million, or 0.5% -- the first increase since the ACA's main programs launched.

Disturbingly, the number of uninsured children increased by 425,000, or 0.6%, raising children's uninsured rate to 5.5%. That spike would appear to be due mainly to a drop in Medicaid coverage, given that  Medicaid and CHIP coverage for children was down 1.2%; and the overall percentage of children with public health insurance dropped 0.8%, while the percentage of children with private health insurance ticked up 0.2%. There was also, however, a sharp spike in the uninsured rate among children in households with incomes over 400% of the Federal Poverty Level (FPL), from 1.9% in 2017 to 2.6% in 2018 -- accounting for almost half of the increase in uninsured children.

Folks at Georgetown University and the Center for Budget and Policy Priorities will probably dive  into the spike in uninsured children, as they have been doing for at least a year. Here I just want to throw some sidelights on the Census numbers generally.

1. Affluent uninsured population spikes. Notwithstanding a drop of 2 million  (0.7%) in Medicaid enrollment, the sharpest increases in the uninsured were at high incomes. At 300-399% FPL, the insured rate dropped a full percentage point, from 92.9% to 91.9%, and at over 400% FPL, the rate dropped 0.8%, from 97.3% to 96.6%. Together, these two income groups account for 55% of the population. Particularly striking, the number of uninsured at incomes over 300% FPL increased 23.8% (from 6.631 million in 2017 to 8.215 million in 2018).  The spike in uninsured children at high income levels seems congruent with this drop.

These losses were concentrated in private insurance, down 1.3% percentage points at both income levels. The private insurance losses stem in part from the individual market, where unsubsidized enrollment dropped by 1.8 million in 2018, according to the Kaiser Family Foundation's estimate.  That drop is part of a longer term free-fall, from 9.1 million unsubsidized in the individual market in in the first quarter of  2016  to 4.7 million in Q1 2019, according to Kaiser.

2. Medicare offset. The uninsured spike is bigger among uninsured adults aged 19-64, up 0.8%, than in the population as a whole, up 0.5%. The uninsured increase in the total population is partly offset by people aging into Medicare. Medicare enrollment increased by 1.6 million, with the increase occurring entirely among the elderly. Disability Medicare enrollment apparently dropped somewhat, as the number of people over age 65 reported to have who gained Medicare is slightly larger (1.556 million) than the reported total Medicare gain (1.550 million). The over-65 population increased by 1.7 million in 2018, while the under-65 population dropped by 543,000. The Times They Are a-Agin...

3. Upward income shift. The increase in the uninsured affluent population is accompanied by an upward income shift in the population as a whole. The percentage of the population with incomes from 0-200% FPL downticked from 29.6% in 2017 to 28.9% in 2018 (and from 33.5% in 2013*). The percentage with incomes over 300% rose from 54.7% to 55.4%

The composition of the uninsured population has likewise shifted. The percentage of uninsured with incomes under 200% FPL shrank to 50.1% in 2018 from 52.9% in 2017 (and 55% in 2013**). The percentage of uninsured with incomes over 300% FPL spiked from 25.9% in 2017 to 30.0% in 2018.

4. Sideways movement in the center. In tracking income shifts in the uninsured I've left out the center - 200-299% FPL -- in part because it stayed flat on net (down 0.1%, statistically insignificant). But there were big shifts among the insured at this income level (hat tip to Matthew Brault, a Harvard public health PhD student).  Insurance through public programs dropped 1.1% in this income group by (558,000) -- notwithstanding an increase in Medicare enrollment probably in the range of 250,000 (if the percentage of seniors in this income band is proportionate to the percentage in the total population). At the same time, though, private insurance increased 0.9% at this income level. Perhaps income shifted upward within this income category, as it did in the income distribution as a whole.

Lest anyone wonder what some 9 million people at incomes in the 200-299% FPL income range are doing in Medicaid, as the eligibility threshold is 138% FPL in states that accepted the ACA Medicaid expansion and lower in states that did not, a few factors:
  1. Disability Medicaid - 54% of people under age 65 with a disability have public coverage. States have buy-in programs for working people with disabilities; the average income threshold for these programs is about $2,500 per month (roughly 250% FPL for a single person).
  2. CHIP - public insurance for children in families with incomes too high to qualify for Medicaid proper. In almost all states, CHIP eligibility extends beyond 200% FPL, and it goes as high as 400% FPL. There are 6.6 million children in CHIP in 2019.
  3. Income-eligible: Whereas the Census defines a household as all people under one roof, the ACA determines income on the basis of a tax household, which in many cases is smaller. Some households classed as over 200% FPL in the Census's Current Population Survey may be in tax households under 138% FPL.
  4. Under-reporting -- some households may underestimate their income and gain Medicaid access for a shorter or longer period. 
That's all I've got. A Medicaid enrollment drop of 2 million at the very least embeds bad news with respect to children, and is likely due in part to various Republican administrative and legislative measures: the public charge rule (Hispanic enrollment is down), repeal of the individual mandate, work requirements and other red tape deliberately imposed on enrollees by red states, with CMS's incitement. At the same time, it should be recognized that Medicaid enrollment drops do not seem to be the main engine of the uptick in the adult uninsured population, and that adult Medicaid enrollment drops are driven at least in part by income increases.

*   The report is based mainly on the Current Population Survey Annual Social and Economic Supplement (CPS ASEC)
** The Census report warns that comparisons with years prior to 2017 should be regarded with caution, as new data analysis methods used this year were projected back only as far as 2017.

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