August 28, 2007

August 28, 2007 | News Releases on Health Care

The Heritage Foundation Responds to Uninsured Numbers in New U.S. Census Bureau Report

WASHINGTON, AUG. 28, 2007 - Look closely behind the Census Bureau numbers of the uninsured, now estimated at 47 million, or 15.8 percent of the population. How one diagnoses the problem will largely determine how one prescribes the remedy. For those in Congress who want a government health care monopoly, the answer is simple: progressively expand government control over the entire health care sector of the economy, and push persons out of private health coverage, beginning with a robust expansion of the State Childrens' Health Insurance Program(SCHIP).  For Americans who want to take personal control over their health care decisions, a more sophisticated policy is required.  Meanwhile, in reading the Census Bureau numbers, policymakers should bear three things in mind:  

  • The Census Bureau data is misleading. The Census Bureau's Current Population Survey (CPS) is a misleading measure of those who lack health insurance in America and an imprecise tool for analyzing the dimensions of the problem. Analysis of data from earlier Census Bureau and other government reports shows that roughly 7 million are illegal immigrants; roughly 9 million are persons on Medicaid; 3.5 million are persons already eligible for government health programs; and approximately 20 million have, or live, in families with incomes greater than twice the federal poverty level, or $41,300 for a family of four.

  • Most of the uninsured are in and out of health coverage.  The professional literature also shows that, overwhelmingly, the vast majority of the uninsured are persons who are in and out of coverage, largely as a result of job changes. Only a small number of the uninsured are chronically uninsured. For most of the uninsured, the problem is fixable if policymakers simply take steps to make health insurance portable, so the insurance policy sticks to the person, not the job.

  • Current Federal Tax Policy Fuels Uninsurance.  A substantial portion of uninsured Americans are not poor but rather middle-class working Americans who are forced to face a major tax penalty, resulting in premium increases of 40 to 50 percent, if they do not obtain health insurance through the place of work. For millions of Americans without job based health insurance, both the tax policy, and the excessive regulatory burden on health insurance in the states, prices families out of coverage. Current federal tax policy then unnecessarily drives millions into the ranks of the uninsured.

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