45.8 million now uninsured; growing ranks spur call for action

Last year marked the fourth consecutive year that uninsured numbers rose. Medicaid rolls continued to grow, too.

By Joel B. Finkelstein — Posted Sept. 19, 2005

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Washington -- Recent findings from the Current Population Survey that the ranks of the uninsured continue to grow rapidly have renewed concerns about rising health care costs and congressional priorities.

The number of uninsured grew to more than 45.8 million in 2004, compared with slightly fewer than 45 million in 2003, according to the report the U.S. Census Bureau released Aug. 30.

Census officials were careful to point out that population growth means the increase did not represent a significant change in the percentage of uninsured Americans. That stood at 15.7% in 2004, compared with 15.6% in 2003.

But experts voiced concern that the total number of uninsured people continues to rise year after year. In 2000, the last year that the number declined, there were 39.8 million without insurance, or 14.2% of the population. Since then, the ranks of uninsured have jumped on average by more than 1 million a year.

"While the increased number is statistically small, an additional 860,000 Americans live without the safety net of health insurance," American Medical Association President J. Edward Hill, MD, said in response to the latest figures.

"Without insurance, many Americans don't seek medical care until their health problem reaches crisis proportions," Dr. Hill noted. "By forgoing regular doctor visits and diagnostic tests that could catch serious illnesses early, many uninsured patients are diagnosed too late to affect the outcome."

Although the national percentage of uninsured didn't rise last year, the rates did go up significantly in eight states -- Delaware, Florida, Massachusetts, Montana, New Hampshire, Oklahoma, South Carolina and Tennessee. The new numbers are putting stress on the health infrastructure in some of those states.

Comprehensive Health Services, Ridgeland, S.C., saw about a 10% increase in the number of uninsured patients over the past 18 months, said Executive Director Roland Gardner.

The community health center already runs on slim profit margins, making it difficult to budget for the increase in low-paying uninsured patients. It has meant forgoing staff raises, delaying new hires and putting off buying new equipment, Gardner said.

"Even cosmetic repairs that make the building look more welcoming and less like a clinic have to wait," he said.

The belt-tightening also hinders the center's physicians, often making their jobs more difficult than they already are.

"It really handcuffs them," Gardner said.

A call for reforms

The Census report also revealed that the Medicaid rolls have continued to rise precipitously. The program covered more than 37.5 million patients last year, which is nearly 2 million more than in 2003 and 8 million more than in 2000.

The increase in the number of the uninsured is troubling, but it could have been much worse had it not been for the Medicaid program, said Kathleen Stoll, health policy director for Families USA, a public advocacy organization in Washington, D.C.

Given Medicaid's role in attenuating the effects of rising health insurance costs, some groups questioned the focus in Congress on shaving $10 billion in funding from the program over the next five years, as dictated by next year's federal budget plan.

"Now more than ever, it is important to protect the programs that offer health care to our most vulnerable populations. Unfortunately, the president and Congress are poised to move in the wrong direction: Instead of finding solutions for the uninsured, they are proposing significant cuts to Medicaid," Stoll said.

Medicaid funding should be bolstered, and states need to be encouraged to expand enrollment, she said.

Other groups also are calling on Congress to focus on reforms to address the rising tide of uninsured, such as tax credits and other proposed subsidies designed to expand access to health coverage.

"Today's report should be a call to action for policy-makers and health care stakeholders to work together to implement a workable plan that promotes access," said Karen Ignani, president and CEO of America's Health Insurance Plans, an industry trade group.

Dr. Hill urged stakeholders to come together to devise strategies to help the uninsured.

"As the decrease in employment-based health insurance continues, the AMA renews its call for health insurance solutions that put patients in the driver's seat, along with their physicians," he said.

The AMA plan for reducing the ranks of the uninsured includes expanded coverage and choice through refundable tax credits inversely related to income, and individually selected and owned health insurance. It also calls for a wide range of new, affordable insurance options.

Without major health care reforms, the number of uninsured can be expected to continue increasing, Stoll said.

A recent Harvard University survey found that among the insured, 66% report that their premiums have gone up over the past five years. And 70% of the uninsured survey respondents said the cost of health insurance is what keeps them from purchasing coverage.

While there are some signs that the rise in health insurance premiums could be slowing, premium increases remain in the double digits, going up faster than wages or inflation.

"As health care costs continue to rise, premiums are becoming less affordable for companies and their workers. Increasingly, they will turn to Medicaid," said Vernon Smith, PhD, who is a principal at Health Management Associates, a national health care research and consulting firm.

There is no question among state officials that the continued erosion in employer-based health benefits will have a big impact on Medicaid. But it is unclear whether Medicaid can continue absorbing those who have lost their private coverage, Dr. Smith said.

Medicaid is already severely straining state budgets. Many state governments already have approved or implemented cost-containment measures that affect enrollment in the program and could freeze out new patients, Stoll said.

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A shift in coverage

The past five years have been marked by a consistent rise in the number of people without health insurance. There has also been a major shift in coverage, with fewer individuals receiving benefits through their employer and more receiving health care through the Medicaid program.

Uninsured Medicaid Employer-based
2004 45.8 million 37.5 million 174.2 million
2003 45.0 million 35.6 million 174.0 million
2002 43.6 million 33.2 million 175.3 million
2001 41.2 million 31.6 million 176.6 million
2000 39.8 million 29.5 million 177.8 million

Source: U.S. Current Population Survey, August

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Hard-hit states

Although the national uninsured rate stayed steady -- increasing by only 0.1% -- eight states saw a more significant increase in the proportion of their uninsured.

2003 2004 Percentage
point change
Delaware 10.5% 12.8% 2.3
Florida 17.7% 19.0% 1.3
Massachusetts 10.3% 11.2% 0.9
Montana 17.3% 19.2% 1.9
New Hampshire 10.1% 11.0% 0.9
Oklahoma 18.8% 20.1% 1.3
South Carolina 13.4% 14.5% 1.1
Tennessee 12.0% 13.7% 1.7

Source: U.S. Current Population Survey, August

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Less is spent on health care for immigrants

Immigrants see 55% less spent on their health care compared with American-born citizens, according to a study in the August American Journal of Public Health.

The study, which includes all immigrants regardless of legal status, is based on data from the Agency for Healthcare Research and Quality's 1998 Medical Expenditure Panel Survey. Immigrant children see 74% less spent on their health care compared with their U.S.-born counterparts, the study found.

"I actually think that the disparities in more recent data would probably be worse," said Sarita A. Mohanty, MD, MPH, the study's lead author and an assistant professor of medicine at the University of Southern California, Los Angeles. "We have a growing number of uninsured, and immigrants are more likely to be uninsured than the U.S.-born."

On average, all American-born patients received $2,546 in health care in 1998, compared with $1,139 for all immigrants. When it comes to children, those born in another country received just $270 in health care in 1998, compared with $1,059 for U.S.-born children. Those estimates include payments from private insurers, patients and the government, as well as hospital charge-offs for uncollected liabilities, negotiated discounts, bad debt and free care.

U.S. Census figures for 2004 released last month show that 33.7% of foreign-born residents lack health insurance, versus 13.3% of the U.S.-born. Only 17.2% of naturalized citizens are uninsured.

The authors speculate that part of the disparity is due to mid-1990s federal welfare and immigration reforms that put a waiting period on Medicaid eligibility and made qualifying for Medicaid more difficult for immigrants.

"This caused a lot of confusion and a lot of fear," Dr. Mohanty pointed out. "A lot of states have tried to combat that and continue public insurance through their own plans. Still, there are a lot of fears about participating."

In addition to language barriers, newcomers often find the American health system bafflingly difficult to navigate. "Many immigrants come from Latin American countries, where health care is automatic," said Elena Rios, MD, MPH, president of the National Hispanic Medical Assn.

"You don't have to have an insurance card. You get pharmaceuticals in drug stores; you don't go to doctors to get a prescription. It's a different system," Dr. Rios said.

In February the AMA helped launch the Commission to Eliminate Health Disparities, a coalition of 30 health-related organizations aimed at identifying solutions to the problem.

-- By Kevin O'Reilly

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