Understanding the Uninsured: A Descriptive Study of the U.S. Uninsured Population

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Michael Barnett and Dr. Eric Eide, Department of Economics

My initial research topic was to determine whether individuals who needed longterm care dispersed their assets in order to qualify for Medicaid coverage. In doing this, I hoped to identify the existence of a relationship between asset dispersion and longterm Medicare claims and then quantify the affect of this relationship. However, as is often the case with research, my mentor and I ran into problems. The main problem was that we did not gain access to the newly released data set that linked the Centers for Medicare and Medicaid Services data with the Panel Study of Income Dynamics data. Because of this, we shifted our focus to a different aspect of the healthcare system. Given that our government has passed a bill to implement a new universal healthcare system, known as “Obamacare”, I wanted to better understand the impact that such a system would have, financially speaking. To do this, I have used the Medical Expenditures Panel Survey data to develop a financial profile for the typical unemployed American for the period of 20012008. First, I will briefly provide a review of previous literature on the subject. I will then provide a description of the data that is used. Finally, I provide the results, interpret what they mean, and conclude.

The uninsured population of the United States has been a topic of interest for quite some time. Freeman, Aiken, Blendon, and Corey (1990) used the 1986 national Robert Wood Johnson Access Survey to develop a demographic profile for the uninsured population in 1986 (footnote). This profile showed that the uninsured population during that time was mostly comprised of poor or nearly poor individuals who were typically Hispanic, unemployed, unmarried, and fairly young. The U.S. General Accounting Office (GAO) used the 1988 Current Population Survey from the U.S. Census Bureau to develop a profile of what the uninsured population at that time looked like (footnote). The GAO found that the 1988 uninsured population under 65 “tended to be concentrated among the lower income, minority, youth, unmarried, and less educated segments of the population.” In a study done by the Kaiser Family Foundation in 1994, they described the uninsured population for 1992 as being mainly in the 2465 years of age category, above the poverty line, and working family members whose employers do not provide health insurance. This painted a new picture in terms of what the uninsured population was becoming as time moved along. Shi (1999) used the 1996 Medical Expenditures Panel Survey to determine a profile for the 1996 uninsured population. Shi found that “[w]hile race and income significantly influence insurance coverage, respectively, there was relatively little disparity in insurance due to health status”. Shi thus confirms that minorities and lowincome individuals are the group that primarily forms the uninsured population. However, Shi establishes that one intuitive indicator of whether an individual would have health insurance (health status), may not actually play any role in the decision at all. Kuttner (1999) finds that the uninsured population in 1996 is composed mostly of minority and lowincome individuals, providing further evidence to Shi (1999) and other profiles developed previously.

In my research, I used the Medical Expenditures Panel Survey data for 20012008. By doing this, I can compare how the average uninsured individual changes over time. Because the Medical Expenditures Panel Survey provides medical expenditure and events data, I will be able to develop a profile that shows the typical health expenses and health events incurred by the uninsured population, a different perspective than the demographic profiles previously done. Only those who are uninsured for the entire year are counted as being part of the uninsured population. The first thing to note is that typical healthcare events (number of visits to the emergency room and number of doctor’s office visits) seemingly remain steady over our period of interest. Also, the averages for these two types of healthcare events seem quite standard. This would coincide with Shi who found that health status is not a major factor in determining whether and individual is insured or not. Note that both income and total health care expenses trend upwards both in mean and standard deviation. However, the percentage increase in health care expenses (56.29%) far exceeds that of the percentage increase in income (5.79%). Not only will the government have to fund a substantial expense to insure that all individuals are insured, it is an expense that is growing at an extraordinary rate. The table below presents the results.

These results spur the possibility for future investigation, such as looking to see if there exists a more cost effective way for our government to insure individuals. One possibility could be to create jobs that provide health insurance. Providing insurance to the unemployed population may not be as costly because of the offsetting revenues generated through income taxes of newly employed individuals. Also, a large number of uninsured individuals may fall into this category. What is apparent from this research is that insuring millions of individuals is a task of considerable financial encumbrance and should be examined carefully by all involved.

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References

  • Anderson, Gerard F., and Bianca K. Frogner. “Health Spending In OECD Countries: Obtaining Value Per Dollar”. Health Affairs (2008). Volume 27:6, 17181727.
  • Carrasquillo, Olveen, David U. Himmelstein, Steffie Woolhandler, and David H. Bor. “Trends in Health Insurance Coverage, 19891997”. International Journal of Health Services (1999).Volume 29:3, 467483.
  • Freeman, H.E., R.J. Blendon, L.H. Aiken, et al., and C.R. Corey. “Americans report on their access to healthcare”. Health Affairs (1987). Volume 6:6, 418.
  • “Health Insurance Coverage: A Profile of the Uninsured in Selected States, HRD9131FS February 8, 1991”. United States General Accounting Office (1991).
  • Kuttner, Robert. “Health Insurance Coverage”. New England Journal of Medicine (1999). Volume 340, 163168.
  • Rowland, Sc. D., Diane, Barbara Lyons, M.H.S., Alina Salganicoff, and Peter Long. “A Profile of the Uninsured in America, March 9, 1994”. Kaiser Family Foundation.
  • Shi, Leiyu. “The convergence of vulnerable characteristics and health insurance in the US”. Social Science & Medicine (2001). Volume 53, 519–529.