Tuesday, October 09, 2007

The Health Care Crisis that Wasn't: What they're not telling you about the "Uninsured"

When politicians start telling you there is a crisis that we, as a society, need to address, it's usually best to let the livestock loose and hide the family in the basement. And take your wallet with you: it's the first thing they'll look for.

The issue of the election of 2008 is shaping up to be health care; specifically, the problem of the number of poor people who are uninsured. Hillary has unveiled her health care plan, and Democrats in the U. S. Congress have tried to embarrass Republicans with a bill that would insure children.

But what if the problem of the uninsured was overstated by the politicians? It sounds amazing, I know--that politicians would overstate a problem. But there it is.

But Robert Martin, Ewing T. Boles Professor of Economics at Centre College (in my hometown of Danville, Kentucky) has come up with some very interesting statistics from the U. S. Census Bureau on the problem of the uninsured that some politicians have (wouldn't you know it), failed to relate to their audiences as they stump the country proclaiming that the end of health care is near.

According to the Census Bureau's report, "Income, Poverty, and Health Insurance Coverage in the United States: 2006", there are almost 47 million uninsured people in the United States. But, despite much of the apocalyptic rhetoric propounded by the left, a surprising proportion of the uninsured are not poor, nor are the poor who are insured necessarily U. S. citizens. In addition, the vast majority of the short-term increase in the ranks of the uninsured comes, not from the poor, but from middle class and the rich.

Here are four statistics that call into question the claims of those who say the problem of the lack of health insurance among the poor is an worsening problem:

  • 37.8 percent (over a third) of the uninsured in America are in households with incomes in the top half of the income distribution. The likely explanation, says Martin (not me: the real one), is that fewer employers are offering health care insurance. Before this, says Martin, "people signed up for health insurance automatically. Now, they have to elect to purchase health insurance. The data reveals some people with high incomes are choosing not to purchase health insurance." I hate to mention it, since it might give Hillary ideas, but the only way to solve this would be through requiring people to use their money for health insurance rather than something else, but that would violate their right to choose what they do with their money.
  • 21.8 percent (over a fifth) of the uninsured in America are non-U. S. citizens. According to Martin, the Census Bureau does not keep records on the legal status of non-citizens. But, "If they are illegal aliens, we would not be surprised that they are uninsured." In fact, the number of uninsured non-citizens increased from 2005 to 2006 by 835,000. Martin adds to this fact a telling observation: "[T]he five states with the highest uninsured rates are Texas, New Mexico, Florida, Arizona, and Oklahoma." Go figure.
  • 93% of the increase in the uninsured is among those with annual incomes of $50,000 or more. This figure is the change from 2005 to 2006, and so the long-term difference could be different. But it would be interesting to know, over a longer period of time, whether the same holds true:In fact, if it is true that the ranks of the uninsured are not primarily among the poor, but the middle and upper class, then the only way for Democrats to resolve the problem would be to provide some sort of federal assistance for those in higher income brackets. But isn't that what they are always accusing Republicans of doing?

  • The number of uninsured people with incomes of less than $25,000 decreased by about 519,000. The number of uninsured in the Census Bureau's lowest income category decreased from 14,452,000 in 2005 to 13,933,000 in 2006. Of the four income categories used by the U. S. Census, this was the only one in which there was a decrease.

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