ACCUMULATING PERIPHERALS


Is the private health insurance industry failing? by mattsteinglass
September 10, 2009, 10:13 pm
Filed under: Health

Wonk Room » New Census Numbers: Public Health Programs Are A Lifeline For Americans Who Can’t Afford Coverage .

Igor Volsky says private health insurers are increasingly failing to cover Americans, and government programs are picking up the slack; and adduces a chart that shows private coverage  and employer-based private coverage shrank 0.8% from 2007 to 2008 while Medicare, SCHIP and Medicaid coverage grew. Thing is, this data doesn’t necessarily show what Volsky says it shows. For instance, the population is growing older, so you’d figure more people are shifting out of the workforce and into Medicare eligibility. You’d need to include some data on how much of this change is accounted for demographic shifts before you can draw quite the conclusions he does.

Still, it seems pretty unlikely that the population could age so fast that it would account for most of that shift in just one year. It probably is mostly the rising cost of private health insurance.

Add: I posted this in comments but realize it really belongs in the post: It doesn’t look like this is about aging…

Ben Smith at Politico posts the same chart but also shows the data for 2000. And from 2000 to 2008, it’s much more clear that people are moving out of private insurance and into government. In that time span private coverage fell from 72.6% to 66.7% of the population, while government coverage increased from 24.7% to 27.8% and the uninsured went from 13.7% to 15.4%. And overall, Medicare rose only 0.8%, from 13.5% to 14.3%, with most of that happening last year. So I don’t think this is about aging.

rousetable


3 Comments so far
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What about more Americans getting poorer?

I remember when President Bush argued in the 2004 presidential debate that more Americans than ever were getting Pell Grant money for college, and Senator Kerry pointed out the obvious point: more Americans were getting Pell money because more were slipping down into the income line that allowed them to qualify for it.

Is Volsky’s growth accounted for mostly in Medicare, or mostly in SCHIP and Medicaid?

Comment by Michael Roston

It’s interesting, the data show Medicare grew by a whopping 0.5% of the US population from 2007 to 2008, from covering 13.8% to 14.3% of the population. That would seem to account for most of the 0.8% decline in that year in private coverage. But Medicaid/CHIP grew even more, from 13.2% to 14.1% of the population. And military care grew by 0.1%. And the uninsured grew by 0.1% too.

The numbers don’t add up to 100%. I would expect that’s because CHIP actually means private insurance with a government subsidy, so those people fall into two categories. And some Medicare beneficiaries have supplemental private insurance too.

But here’s the main point: Ben Smith at Politico posts the same chart but also shows the data for 2000. And from 2000 to 2008, it’s much more clear that people are moving out of private insurance and into government. In that time span private coverage fell from 72.6% to 66.7% of the population, while government coverage increased from 24.7% to 27.8% and the uninsured went from 13.7% to 15.4%. And overall, Medicare rose only 0.8%, from 13.5% to 14.3%, with most of that happening last year. So I don’t think this is about aging.

Comment by Matt Steinglass

Mr. Steinglass,

From a actuarial perspective, some people can insured profitably and others cannot. What may be happening is that more people are falling below that threshold. The biggest drop is in employer provided insurance, direct purchase of health insurance is almost unchanged. I would suspect that this is reflecting where job growth and loses are occurring, people who are getting new jobs are getting them with employers who do not provide health insurance while people who are losing jobs are not replacing their employer provided insurance with either the direct purchase of insurance, are getting no insurance, or becoming dependent on government health coverage.

This would suggest to me that overall, people are losing their employer provided insurance and generally not finding replacement insurance.

Comment by davidlosangeles




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