Who has insurance?

Health Insurance Coverage

The majority of American's have health insurance through their employer. But millions do not have any insurance.

US Censor Bureau heath insurance study for 2022 found:

• More people were insured in 2022 than 2021.

• In 2022, 92.1% of people, or 304.0 million, had health insurance at some point during the year compared to 91.7% or 300.9 million in 2021.

• In 2022, private health insurance coverage continued to be more prevalent than public coverage, at 65.6% and 36.1%, respectively.

• Employment-based insurance was the most common, covering 54.5% of the population for some or all of the calendar year.

• Medicaid (18.8%)

• Medicare (18.7%)

• Direct-purchase coverage (9.9%)

• TRICARE (2.4%), and VA and CHAMPVA coverage (1.0%).

• Between 2021 and 2022, the rate of Medicare coverage increased by 0.3%.

• The uninsured rate among working-age adults aged 19 - 64 decreased 0.8% between 2021 and 2022.

♦ In 2022, 25.6 million people did not have insurance the entire year. The number would be much higher if you include the people who did not have health insurance part of the year.

♦ Private Coverage = Employment-based + Direct-purchase + Tricare (formerly known as Civilian Health and Medical Program of the Uniformed Services)

♦ Public Coverage = Medicare + Medicaid including CHIP + CHAMPVA or VA

♦ The percentage of the U.S. population received coverage through government programs is growing.

By September 2023, 81 million people were enrolled in Medicaid and 7 million were enrolled in CHIP.

By the end of 2023, around 66 million people were enrolled in Medicare.

Employer coverage declining

♦ There are a number of reasons for the decline in employer sponsored coverage. Cost is the main reason.

The number of people eligible for employer sponsored health insurance has also been declining. Part of this decline is related to job loss or reduction in hours worked.

♦ The percentage of uninsured is currently hovering around 8.4% or 27.6 million.

This number is grossly unreported by the U.S. Census Bureau which only considers an individual to be uninsured if they do not have health insurance coverage for the entire calendar year.

Cost is a factor

Over 49 million people in the United States had no health insurance in 2010.

♦ Due to factors like the Affordable Care Act and expansion of Medicaid the uninsured rate has been sharply reduced.

• Cost is proving a major barrier, especially for families that do not qualify for a premium tax credit to help subsidize their insurance.

♦ Roughly 97% of larger companies (over 50 employees) continue to offer some form of health insurance coverage as an employment benefit.

The price of which, has more than doubled over the past 10 years.

• The Kaiser Foundation estimates the average cost of covering an employee and his or her family at a large company to be around $24,000 a year. Large companies can better support these hefty sums but smaller companies cannot.

♦ The Affordable Care Act requires all companies with 50 or more full-time employees to offer insurance or pay a penalty.

On average, 32% of companies with fewer than 50 employees offer health insurance.

♦ Small and medium size companies that do not offer any coverage cite cost as the main reason.

Some companies offer more money so their employees can buy insurance on their own. Most however don’t offer much help in the way of subsidizing the cost of coverage.

Will employers drop coverage?

The Affordable Care Act makes the individual market more attractive.

Insurers can no longer refuse to cover someone even if they are not healthy, or to charge them an exorbitant fee.

Individuals with incomes of 100-400% of the Federal Poverty Level may qualify for subsidies to buy insurance through the exchanges.

• The concern is that employers may see this as a chance to save money by dumping their employees on the health exchanges.

To prevent this, the law imposes a steep fine per employee for any employer (with more than 50 employees) that does not sponsor health insurance coverage.

Some companies may opt to pay the fine, however.

♦ Employers that continue to sponsor insurance will be increasing the amount they expect their employees to pay for coverage.

Most will continue to change their health plans to shift more of the cost for services to the employee in the form of higher deductibles and higher copays.

There is expected to be a greater push to use Consumer-Driven Health Plans under the guise of encouraging employees to become more responsibility for their use of health care services.

There will be a continued shift from PPO type plans to more restrictive HMO type plans.

♦ As the employee’s costs increase, there is a danger that they will delay seeking essential treatment for fear of the bill. That could leave companies with a sicker, less productive workforce.

Trends

The trend is clearly away from employer sponsored health insurance, but to what?

Age

Age is strongly associated with the likelihood that a person has health insurance and the type of health insurance a person has.

• Adults aged 65 and over had the highest rate of health insurance coverage because most are eligible for Medicare.

♦ The population aged 26 to 34 is the least likely to be insured.

This is the population that insurance companies want the most. They are the least likely to use health insurance.

♦ Children under age 19 are more likely to be covered by health insurance at a higher rate than working-age adults.

One reason for this could be that children from lower income families may be eligible for programs such as Medicaid or the Children’s Health Insurance Program (CHIP).

The Children’s Health Insurance Program (CHIP) is a government program that provides health insurance to children in families with incomes too high to qualify for Medicaid, but who are unable to afford private health insurance.

Summary

♦ All age groups have experienced a consistent decline in uninsured rates following the adoption of the Affordable Care Act.

• Employers will continue to try to shift more costs to the employees as a means of keeping health insurance as a benefit alive.