Census Losses in Health Coverage Make Reform More Urgent

SOURCE: AP/Jacquelyn Martin

Cassandra Kelsey is shown at her home in Washington on February 26, 2009. Kelsey was recently laid off from her job with Verizon and is now struggling with being unemployed and uninsured. More than 1 million Americans lost employment-based coverage between 2007 and 2008.

By Karen Davenport | September 10, 2009

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Today the Census Bureau released its income, poverty, and health insurance data for 2008. The numbers show that roughly 700,000 Americans lost health coverage from 2007 to 2008, resulting in 46.3 million Americans living without health insurance last year. As President Barack Obama urged last night, Congress should renew its efforts to pass comprehensive health reforms to make sure these losses do not continue. The reforms should strengthen the foundations of employer-based health coverage, improve the health insurance market, and ensure that all Americans have a choice of high-quality, affordable health insurance.

The economic crisis of late 2008 and the accompanying loss of employer-sponsored health insurance underscore the fragility of America’s current health insurance system. More than 1 million Americans lost employment-based coverage between 2007 and 2008—a figure that only offers a preview of the significant recession-based job and health coverage losses that escalated in late 2008 and early 2009. Among those who lost employer-based coverage, many were able to obtain new coverage through public health insurance programs, but others, faced with no affordable options, became uninsured.

While African Americans and Hispanics remain disproportionately uninsured, white Americans were most likely to lose coverage last year. In addition, men, suburbanites, Western residents, and part-time workers were more likely to experience loss of coverage.

Other trends include:

• The number of uninsured Americans increased to 46.3 million in 2008, 680,000 more than in 2007 and nearly 8 million more than 2000.
• Employment-based coverage has continued to fall over time. One million individuals lost employer-sponsored health insurance from 2007 to 2008. While the majority of Americans—58.5 percent—have employer-sponsored coverage, the proportion of Americans with coverage through employers has eroded since 2000, when nearly three-quarters had employer-sponsored coverage.
• The proportion of uninsured adults rose in 2008. More than one in five non-elderly adults lacked health insurance in 2008, an increase of 1.5 million since 2007 and 8.3 million since 2000.
• In contrast to adults, children’s coverage improved—7.3 million children were uninsured in 2008, in comparison to 8.1 million uninsured children in 2007. While 400,000 children lost employer-based coverage, 1.7 million additional children received health insurance through the Medicaid program.

Health reform proposals pending before Congress would address this decline in coverage. By strengthening employer coverage, establishing a viable alternative marketplace through insurance reforms and exchanges, providing help with premiums to individuals and small businesses, and enhancing public programs, policymakers can guarantee affordable coverage for all Americans.

Policymakers know that health care reform will not only address the needs of the millions of Americans without health coverage. Health reform will also improve the vitality and strength of our nation’s economy and is critical to addressing our long-term budget problems. American families will directly benefit from strategies that deliver high-quality, affordable health coverage for all Americans, and they will benefit for years to come from the broader economic impact of health care reform.

Karen Davenport is Director of Health Policy at American Progress. For more on health policy from CAP, see our Health page.

See also:

• New Census Numbers Don't Reflect the Severity of Poverty by Joy Moses
• Census Data Underscores Need for Policies to Bring Down Unemployment by Heather Boushey