New Analysis of the Myth: “46 Million Americans Without Health Insurance”

Advocates for expanding taxpayer-subsidized health insurance through Universal Health and their allies in the press, repeat this 46 million number constantly. Let us walk through the statistics from top to bottom. You may be surprised!

More Information:I’ve previously blogged on this topic here.

But, now there’s a new analysis at iReport that you can view here. You can view it here. Here is some of their work:

  • There were 45.7 million uninsured people in the U.S. in 2007.
  • Of that amount, 6.4 million are the Medicaid undercount.  These are people who are on one of two government health insurance programs, Medicaid or S-CHIP, but mistakenly (intentionally or not) tell the Census taker that they are uninsured.  There is disagreement about the size of the Medicaid undercount.  This figure is based on a 2005 analysis from the Department of Health and Human Services.
  • Another 4.3 million are eligible for free or heavily subsidized government health insurance (again, either Medcaid or SCHIP), but have not yet signed up.  While these people are not pre-enrolled in a health insurance program and are therefore counted as uninsured, if they were to go to an emergency room (or a free clinic), they would be automatically enrolled in that program by the provider after receiving medical care.  There’s an interesting philosophical question that I will skip about whether they are, in fact, uninsured, if technically they are protected from risk.
  • Another 9.3 million are non-citizens.  I cannot break that down into documented vs. undocumented citizens.
  • Another 10.1 million do not fit into any of the above categories, and they have incomes more than 3X (300% of) the poverty level.  For a single person that means their income exceeded $30,600 in 2007, when the median income for a single male was $33,200 and for a female, $21,000.  For a family of four, if your income was more than 3X the poverty level in 2007, you had $62,000 of income or more, and you were above the national median.
  • Of the remaining 15.6 million uninsured, 5 million are adults between ages 18 and 34 and without kids.
  • The remaining 10.6 million do not fit into any of the above categories, so they are:
    • U.S. citizens;
    • with income below 300% of poverty;
    • not on or eligible for a taxpayer-subsidized health insurance program; and
    • not a childless adult between age 18 and 34.

As a policy matter, we care not about the total number of uninsured, but about the subset of that group that we think “deserves” taxpayer-subsidized health insurance.  That is a judgment call that involves some value choices.

I will make one value choice for you and boldly assert that, if you are already enrolled in or eligible for one free or heavily subsidized health insurance program, we can rule you out as needing a second.  That simple statement reduces the 45.7 million number down to 35 million, by excluding the Medicaid undercount and Medicaid/SCHIP eligible from our potential target population.

I think most people would also say that the 10.6 million I have labeled as “remaining uninsured” are the most sympathetic target population.

It then gets tricky.

  • Should people with incomes near or above the national median get health insurance subsidized by taxpayers?
  • How about non-citizens?  Should we distinguish between documented and undocumented non-citizens?  Between those who pay taxes and those who do not?  Remember that we are not talking about who should get emergency medical care, but instead who should get taxpayer subsidies to finance the purchase of pre-paid health insurance.  Does that change your answer?
  • Many young adults and childless couples are in good to excellent health.  Do they deserve subsidies, when they may be making what they believe to be a rational economic decision and using their financial resources for things other than buying health insurance?  Should a 25-year old Yale graduate triathlete making $30K per year get his health insurance subsidized by taxpayers if he chooses not to buy it because his budget is tight?

There is no clear right or wrong answer to the above questions.  You need to make your own value choices for them. Now let us look at the effects on the totals for several hypothetical answers to these questions.

Remember that the advocates, some elected officials, and press, tell us that the numbers are:  46 million uninsured, 15% of the population, and 1 in 6 Americans “are uninsured.”  I suggest you try to figure out which of the following is closest to your view.

  1. Ann wants to subsidize everybody, but agrees that we don’t need to double-subsidize.  She excludes the Medicaid undercount and Medicaid/SHIP eligible from her target population and ends up with 35 million people.  That is still an enormous amount, but it is 10.7 million less than the headline number she heard in the news.  Her target population is now 11.7% of the total U.S. population, down from 15%.  Put another way, she would like taxpayers to help between 1 in 8 and 1 in 9 Americans who she feels are deserving of subsidies to buy health insurance, rather than the 1 in 6 she heard in the press.
  2. Bob agrees with Ann, but thinks that subsidies should go to the poor, or at least not to those who have above the median (or near median) incomes.  His target population is therefore about 25 million people, way down from 46 million.  That is 8.4% of the total U.S. population, or 1 in 12 Americans.  That is still a huge problem, but it is very different from 1 in 6.
  3. Carla agrees with Bob that subsidies should not go to those with incomes near or above the national median.  She also thinks that undocumented citizens should get emergency medical care, but not taxpayer-subsidized pre-paid health insurance.  I will guess a 50/50 split between documented and undocumented of the 9.3 million uninsured non-citizen, and I would appreciate it if someone could help me refine this.  With this assumption, Carla’s target population is about 21 million, or 7% of the total U.S. population.  That is roughly 1 in 14 Americans.
  4. Doug thinks only American citizens with incomes below the national median (and who are not already eligible for another program) should be eligible for additional aid.  His target population is therefore the bottom two bars on the graph, or 15.6 million people.  That is 5.2% of the U.S. population, or 1 in 19 Americans.  If Doug were to further limit subsidies to those below 200% of poverty or 150%, his target population would be a few million people smaller.
  5. Edie agrees with Doug, but thinks that if you are a young adult without kids, you should fend for yourself.  Her target population is 10.6 million people, or 3.5% of the total U.S. population.  That is 1 in 28 Americans.

These are, of course, not the only possible answers, but I think they are a representative.  Even for the most “liberal” set of answers (Ann’s), the headline numbers we hear in the press overstate the extent of the problem by more than 10 million people.

Now even Edie’s narrowest 10.6 million target population is still a lot of people who lack health insurance.  So why does it matter that the press gets the numbers wrong?

  1. If we misdiagnose the problem, we could easily design the wrong policy solution which is precisely what we are witnessing on Capitol Hill. A solid quantitative understanding of who we would like to help and why is important.
  2. Health insurance subsidies cost taxpayers tens of billions of dollars each year.  If we target these funds well and prioritize, we can help more of the people whom we think are deserving of additional assistance, and fewer of those who need less help.  If we target those funds poorly, we will waste a lot of money.  This point is independent of the total amount we spend on subsidizing health insurance.
  3. Health insurance competes with other policy goals for an enormous but still ultimately limited pool of taxpayer funds.  We should neither overstate nor understate the problem to be solved, so that the tradeoffs with other policy goals can be considered fairly.*

When you hear “46 million uninsured,” or “1 in 6 Americans don’t have health insurance,” remember that this is technically correct but misleading.  The more important question is, “How many uninsured people who already qualify for tax-subsidized programs need additional help from taxpayers?”

Here are the topics for my entire series on Health Myths:

2 thoughts on “New Analysis of the Myth: “46 Million Americans Without Health Insurance”

  • My friend, Gary Bauer, wrote:

    Today President Obama became the salesman-in-chief, traveling to New Hampshire to sell his healthcare reform bill, which is on life support amid collapsing poll numbers.

    I was skeptical that we would learn much from this town hall meeting. This White House has a history of using town hall events as staged rallies. It has a history of screening questions and pre-selecting those who can question the president.

    But President Obama made a couple of points that I want to comment on.

    First, he cleared up any confusion as to whether AARP was backing his bill. Twice he said it was.

    He began by restating the main liberal talking point: “There are 46 million of our fellow citizens who don’t have health insurance.”

    The number of uninsured individuals in America is a matter of considerable dispute, but it includes a significant percentage of non-citizens.

    Yet, today the president identified all 46 million as “our fellow citizens.”

    A significant percentage of the 46 million could afford insurance but choose not to buy it for whatever reason.

    That is their right in a free country, but maybe not for long.

    Some currently qualify for government assistance but are not enrolled.

    It seems then that our president is proposing a trillion-dollar wholesale transformation of the world’s best healthcare system to accommodate some small percentage of population who do have legitimate problems.

    Why is it necessary to risk what works so well for so many?

  • Michelle

    From the US census
    45.7 million is the actual number but that’s semantics
    -6.4 million who are Medicare/Medicaid undercut
    -4.3 million already eligible for Medicare/Medicaid but not using the services
    -9.3 million non-citizens (the number is higher but this is census information)
    -10.1 million who are 300% above the poverty line (>33k single and 62k family of 4) who also have the option for healthcare through their jobs

    This leaves 10.6 million uninsured and yes we need to help them but this plan and single payer systems is not the answer. It has failed in Russia, England, France, Spain, Germany, Canada and everywhere else it’s been tried. (All of these countries by the way are moving away from single payer systems and government run healthcare.)

    As a matter of fact Canadian insurance was SO bad people sued and won the right to purchase private insurance and now 70% of the population have private insurance.

    If our healthcare is so broken then why are the US and Japan both private industry insurers #1 and #2 in treating cancer.

    Nearly every serious health issue the US ranks first or second in treating it.

    Why do people flock here from other countries including Canada, England, France for care?

    Why did 15 of 22 Nobel prizes for medicine come out of the US and 2 more come from doctors and scientist working in the US. 17 of 22 (in the past 10 years) come from this country and our innovations save lives.

    Are women in England dying from breast cancer at rates 25 times that in the US acceptable?

    Are men dying at 19 times the rate of prostate cancer like in France acceptable?

    Are people dying of other forms of cancer at 2 – 5 times the rate in the us like in Canada acceptable?

    {Chaoulli v.Quebec (Attorney General), 2005, IS.C.R. 791, 2005 SCC 35}. A court case that in 2005 allowed “free market” insurance to be sold. Today 70% of Canadians now have private healthcare and only after 2005 did the Canadian life span improve and only then did they begin to close the gap on the US in cancer survivability. But still today 2 times as many canadians die for treatable cancer than die in the US from the same kinds of cancer.

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