What Health Insurance Crisis?
Who and where are the 45 million Americans that the Census Bureau found without health insurance? With little fanfare last year, the BlueCross BlueShield Assn. released a report based in part on analyzing the Census Bureau data. Its findings may surprise some.
A full 16% of the uninsured, the study found, have incomes above $75,000 a year and could obviously afford insurance if they chose to buy it. Roughly a third of those lacking insurance earn $50,000 a year or more.
You may think that a poor single mom with three children living in South-Central Los Angeles is among the uninsured, but in fact, she is eligible for Medicaid, as are her children. The BlueCross BlueShield study notes that 1 in 3 of the uninsured are eligible for — but not enrolled in — a government-sponsored health program. Because Medicaid and children's health programs allow patients to be signed up literally in the ER, these individuals could be covered; they just choose not to do the paperwork.
And of the remaining uninsured, 6 million lack insurance for only a few months.
The bottom line: About 8.2 million Americans, not 45 million, are chronically uninsured and low-income. And they are the working poor. They have jobs but, because of the high cost of insurance, no coverage.
In some ways, of course, even they are covered. In the event of a disaster, they can find care in emergency rooms. They are thus covered for their heart attacks, car accidents and strokes. For the most part, the care will be excellent and very likely free; the expenses are written off or, perhaps, buried in the bills of those with insurance. But when it comes to more routine care — basic primary and preventive care — too many go without. It's these individuals that need the most attention. After all, the chronically uninsured often have no choice.
Why? Insurance is expensive. For middle-class Americans, though, paying a few thousand dollars a year for a simple plan isn't an obstacle. But what of the minimum-wage earner? Yet rather than working to ensure less expensive insurance, state governments have done the opposite. "Iatrogenic" is the term doctors use to describe a simple phenomenon — when the medical profession causes the patient's problem. What do we make of politicians whose policies end up hurting the very people they are aimed at helping?
That is exactly what politicians did in the 1990s. In an attempt to make health insurance more equitable and fair, regulation after regulation was added to the books. Many states now dictate what health insurance must cover (including pastoral counseling in Vermont), who must be covered and at what price. In New Jersey, according to the Coalition Against Guaranteed Issue, it now costs more to purchase a family health policy than to lease a Ferrari. That millions of people lack insurance isn't surprising: Millions of Americans would lack clothes too, if governments insisted that we shop only at Saks.
What, then, to do about the uninsured? Both the president and his Democratic challenger have ideas — and both miss the point. President Bush wants to give every uninsured person a tax credit for $1,000 to help with the cost of coverage. The plan offers too much help to those who don't need it and does too little for the working poor. Sen. John F. Kerry has an expensive and complex plan that ultimately will create even more regulations and government control.
State regulations have crippled insurance choices and driven up the cost of coverage in many jurisdictions. Washington can address this by allowing people the option of buying insurance from insurers that are registered in states other than the one in which they live. By shopping around, uninsured Americans could find a low-regulation (and thus low-cost) state in which to buy coverage.
Second, make smarter use of the money already spent on the uninsured. According to a recent study published in Health Affairs, the government spends almost $35 billion a year providing care to those lacking coverage. Because these programs primarily fund emergency care provided by hospitals rather than insurance, they end up serving hospitals' interests more than patient health.
Here's an alternative: Washington should offer states block funding (using welfare reform as a model) and allow them to experiment with coverage options. Some states would spend the money on the people who need it most: the chronically uninsured. By not focusing on the higher-income uninsured, or those eligible for government insurance, a state-created voucher program could potentially offer thousands of dollars per person for coverage — enough to buy insurance in any state in the nation.
There are, of course, numerous issues to work out, but this much is clear: A small number of Americans are in need, and a large amount is already spent.