The number of uninsured in the United States is a large and growing problem. In 2006, 46.5 million nonelderly people –about 18% of the population under age 65—lacked health coverage, which represented an increase of 3.5 million people since 2004. As health coverage becomes increasingly unaffordable, especially during downturns in the economy, the number of uninsured is likely to continue to increase. Research shows that the uninsured have reduced access to health services and worse health outcomes, making expanding health coverage a key health policy issue.
Though there is general agreement that a growing uninsured population is a problem, there is disagreement over what policies to implement in order to address this problem. This lack of consensus generally centers on whether the federal and state governments should play a larger role in providing and regulating coverage or whether proposals should rely more on the private market. In proposals developed both at the state and national level, the approaches tend to feature policy levers that fall into several broad categories—new pathways to health insurance to make coverage more available, financial assistance through changes to the tax system and direct subsidies to make coverage more affordable, and changes to the way insurance market are regulated. Another feature of some state and national proposals is the inclusion of mandates on individuals to obtain health coverage and employers to provide or help finance coverage for their employees.
As policymakers debate the issues related to improving health coverage for the uninsured, discussion will likely focus on several key issues, including:
- What are the key factors that lead to people not having insurance? Do the policy options address these barriers?
- What are the trade-offs associated with different proposals, such as tax credits or public program expansions?
- How do alternative policy options satisfy certain policy goals? For example, which policy options provide coverage to the greatest number of uninsured for the least amount of funding? Or, which options do best at providing equivalent subsidies to people in similar economic circumstances?
- Does the policy option provide insurance coverage that is affordable and access to quality health care services?
- Who among the uninsured (e.g., by income, age, and health status) is most likely to gain coverage under alternative proposals?
- How well-targeted is the option? What is the cost per previously uninsured—i.e., does most of the spending go toward helping the uninsured gain new coverage, or does some of the spending subsidize people who already had coverage?
- What does the proposal do to existing coverage? Does it cause some insured people to switch to new forms of subsidized coverage, or cause some employers to stop offering health benefits?
- How do vulnerable populations, such as those who are low-income or in poor health status, fare under different proposals?
- What are the relative roles of the state and federal governments and the private sector in different proposals? What are the barriers to implementing the plan?
- Is the proposal financed adequately?
- What does the proposal do to reform the health system?
Acknowledgements: This issue module was prepared by Adele Shartzer, Kaiser Commission on Medicaid and the Uninsured.
Updated: May 2008