By Jerry Geisel, Crain News Service
WASHINGTON (Oct. 5, 2015) — The number and percentage of uninsured Americans plunged in 2014, the U.S. Census Bureau said Sept. 30 in a report.
Triggered by key provisions of the healthcare reform law that went into effect last year, 33 million people lacked coverage in 2014, down 8.8 million compared with the 41.8 million without coverage in 2013.
Similarly, the percentage of the population who were uninsured dropped in 2014 to 10.4 percent, down from 13.3 percent in 2013.
That surge in coverage will not only help millions of previously uninsured Americans, it also could benefit employers because medical providers are seeing a decline in uncompensated care — a cost they shifted, when possible, to those with employment-based coverage in the form of higher charges.
That coverage expansion “should eventually lead to a lowering of the cost of uncompensated care that otherwise would fall on the shoulders of those who pay for health coverage,” said Gretchen Young, senior vice president of health policy with the ERISA Industry Committee in Washington.
While dramatic and in sharp contrast to the six prior years when coverage rates were relatively stable, last year's steep fall in the number and percentage of the uninsured was not unexpected.
That is because key provisions of the healthcare reform law — lowering of Medicaid eligibility requirements in states that chose to do so, the opening of public health insurance exchanges and the extension of federal premium subsidies to the lower-income uninsured — first took effect in 2014 and were widely expected to have a big impact on the uninsured rate.
Indeed, the Census Bureau, in its report, notes that the decreases in the uninsured rates “are consistent” with what the Patient Protection and Affordable Care Act (ACA) intended.
“Based on family income, some people may have qualified for subsidies or tax credits to help pay for premiums associated with health insurance plans. In addition, the population with lower income may have become eligible for Medicaid coverage if they resided in one of the 24 states (or the District of Columbia) that expanded Medicaid eligibility,” the Census Bureau said in the report.
For example, 61.7 million people, or 19.5 percent of the population, were covered by Medicaid in 2014, up sharply from 2013 when 54.9 million, or 17.5 percent of the population, were covered by Medicaid.
On the other hand, employment-based coverage remained nearly stable. In 2014, 175 million people, or 55.4 percent of the population, had employment-based coverage, which is statistically unchanged from 2013, when 174.4 million, or 55.7 percent of the population, had employment-based coverage.
That stability is in sharp contrast to predictions following passage of the ACA in 2010, when critics warned that some employers would drop coverage because of the availability, for example, of federal premium subsidies to individuals.
In fact, some employers — in anticipation of stiff ACA penalties — may have eased health plan eligibility requirements, while employees who previously declined coverage enrolled in plans in 2014 to avoid ACA penalties assessed on those lacking coverage, said Steve Wojcik, vice president of public policy at the National Business Group on Health in Washington.
The report also found that at 3.3 percent, Massachusetts had the lowest uninsured rate of any state, down from 3.7 percent in 2013.
At the other end of the spectrum, Texas had the highest uninsured rate of any state: 19.1 percent in 2014, down from 22.1 percent in 2013.
This report appeared on the website of Crain's Business Insurance magazine, a Chicago-based sister publication of Tire Business.