Number Of Uninsured US Residents Projected To Rise

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For every one point rise inthe U.S. unemployment rate, the number of uninsured is projected to increase by1.1 million people, according to a Kaiser Family Foundation Commission onMedicaid and the Uninsured analysis released Tuesday, the NewYork Times reports (Sack, New York Times,4/29). The report, conducted by researchers at the Urban Institute's Health Policy Center, also examined the effect that a one-percentage-point rise in thenational unemployment rate would have on state Medicaid and SCHIP programs(Francis, "Health Blog," Wall Street Journal,4/28). In addition to the increase in the number of uninsured, the analysisprojects that for every percentage-point increase in unemployment:

  • Medicaid and SCHIP enrollment would increase by 600,000 children and by 400,000 nonelderly adults;
  • Enrollment jumps in Medicaid and SCHIP would cost an additional $3.4 billion, of which $1.4 billion states would be required to pay; and
  • State general fund revenues would drop by 3% to 4%, likely leading to budget cuts.

Accordingto the researchers, "Because of state balanced-budget requirements,Medicaid and other assistance is most likely to be cut when state residentshave the greatest need for help." According to the New York Times,27 states and Washington, D.C., are forecasting budget deficits forfiscal year 2009, and cuts to Medicaid or SCHIP programs have been proposed in13 states.

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Meanwhile, the unemployment rate has increased by seven-tenths of 1% sinceMarch 2007. According to Urban Institute Director of Health Policy JohnHolahan, job losses often accelerate late in a recessionary cycle, meaning the"heaviest hit is still likely to come." Holahan said the projectionswould be in addition to the enrollment growth normally expected from increasinghealth insurance costs and the erosion of employer-sponsored coverage. Researchersalso said that the impact of the current economic downturn might be worsened byits proximity to the recession in 2001. "You could have more people at thetipping point so we could be underestimating things a little bit," Holahansaid. "This is emerging as a pocketbook issue, and not just as an issue ofmoral principle or access to care," Drew Altman, president and CEO of theFoundation, said (New York Times, 4/29).

Researchers said the federal government could increase all Medicaid fundstemporarily; target federal spending increases to specific states based onneed; or allocate funds discriminatingly to states meeting certain criteria,either for a limited time or with a formula that would be implemented duringfuture economic downturns ("Health Blog," Wall Street Journal,4/28).

Reprintedwith permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign upfor email delivery at kaisernetwork.org/email . The Kaiser Daily Health PolicyReport is published for kaisernetwork.org, a free service of The Henry J.Kaiser Family Foundation.

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