Number Veracity

Already, I've received some questions about the 45+ million number of uninsured Americans, so I'll address them here. Sally Pipes raises some interesting questions about the veracity of this 45+ M number, so I want to break it down. She argues a few things:

1) This is an estimate that looks at someone who lacked insurance at any point in the year; and

2) The number of "chronically" uninsured is far smaller and much less alarming.

Here is how she breaks it down:

• 17.5M make >$50K/year (many of whom are young and believe they will not get sick)
• 10M are not citizens
• 14M are eligible for other government sponsored coverage like SCHIP, Medicaid, and Medicare
• 8M chronically uninsured

Now, she doesn't say that these are mutually exclusive numbers and they total up to 49.5M. I'm not one to nitpick on numbers that are close like this--there will be plenty of time for nitpicking later--so lets examine some of her assumptions.

Sounds pretty dramatic, doesn't it? I mean, is it really a crisis when you've whittled down the uninsured population form 1/6 of the country to 2.5% of the country? Well, yes. But lets dive in.

Point by point:

#1: 17.5M make >$50K/year (many of whom are young and believe they will not get sick)

The danger in this, of course, is the whole absurdity around pre-existing conditions. Should someone get sick during this time of transition--and I mean really sick with cancer or some other life-altering condition--they run the risk of having an insurance company say at a later date that they won't cover the condition. Case in point: a teacher at one of my kids schools had some kind of reprodutive cancer (I think it was uterine, but I don't remember--in any event, it was not aggressive). At a time immediately post high school she was without insurance for a time. Now working, she made too much to qualify for MaineCare (our Medicaid program). The result? Pre-existing condition. She had to pay out of pocket for her cancer treatments. Regardless of whether someone "should" have healthcare, only in a system where we allow for gaps (and allowable exclusions from coverage) in coverage do we run into these kinds of issues.

#2: 10M are not citizens

Although I would like to see Ms. Pipes' numbers here, let's take it at face value. We can assume some are legal, some are not. Regardless, I think the real concern here is both a public health issue, and one of cost-benefit. I am willing to bet that most uninsured non-citizens are more or less able-bodied, though not the type to vacation in the Hamptons. And although there is a strong correlation between health outcomes and wealth (i.e.: the wealthier you are, the healthier you are) there is also a correlation between age and health. (i.e. the younger you are the healthier you are). I am willing to bet that most of these folks would be relatively cheap to include in some kind of health insurance program, or at least it make it available to them at a significantly reduced cost. Besides, communicable diseases don't distinguish between citizens and non-citizens. Best provide everyone with affordable coverage.

#3: 14M are eligible for other public programs (Medicaid, SCHIP, Medicare)

Again, let's assume this is true, as I don't have any reason to believe it isn't. The real problem with this is that it impugns the motives of the low incomes individuals that might qualify for Medicaid and SCHIP in particular. Furthermore, it assumes that they are monolithic programs, which they are not. In particular, for Medicaid and SCHIP there are 51 different eligibility requirements for each program that all depends on which state you live in (Washington DC is treated as a state for these purposes). Furthermore, you have to prove eligibility differently in each state. And finally, there's Texas.

I bring up the case of Texas because Pipes suggests that signing up for health insurance is as easy as starting a job and choosing a PCP from a book of in-network MDs. Sorry folks. Our state governments make it far more difficult, sometimes deliberately so.

The graph below shows enrollment in Texas’ SCHIP program every June from 2002 to 2007. When Texas launched their SCHIP program, they met with wild success. Very quickly, they had enrolled more than 1/2 a million kids in their program. But what happened in 2004 and beyond? Were there suddenly fewer kids actually eligible for Texas SCHIP program? Hardly.

SCHIP Enrollment in Texas Year Enrollment (in 000) 2002 530 2003 513 2004 360 2005 326 2006 293 2007 327

(Data courtesy of Kaiser State Health Facts)(nb: I had a nice graph for this, but I couldn't figure out how to get it loaded to the blog. Help anyone?)

Now, most states would consider high enrollment a mark of a successful program. Not so with Texas. Very quickly, they saw the SCHIP program, even with the generous federal match, as a huge drag on their state finances. Rather than monkey with eligibility requirements or cap enrollment (both of which would have been politically untenable) the legislature instead mandated the use of more complicated enrollment paperwork. That’s right. Paperwork. The result? Well, I think it speaks for itself. More than 150K kids lost eligibility in the first year. Way to go, Tex.

Bottom Line: If we are truly invested in ensuring that people were covered with health insurance, we would make it far easier to do. Offering coverage but making the enrollment/eligibility verification process too difficult to complete is akin to putting a stumbling block before the blind.

#4: 8M Chronically uninsured

This, of course, is what’s left over when you take everything else away. But I think even she would agree that these folks need to get covered.

In conclusion:

On a final note, Pipes doesn't even touch the subject of underinsured--those Americans who don't have adequate coverage to prevent an illness from wiping them out financially. And I would love to be able to compare these numbers to our OECD colleagues, as this is as close as we are going to get to reasonable comparisons. But here’s the problem: under-insured, periodically uninsured and chronically uninsured are not meaningful distinctions in OECD countries. They cover their citizens. We don’t.