What to Look for in Next Week’s Census Figures on Poverty, Income, and Health Insurance
"Mar-a-Lago Comes for British Health"
September 5, 2019
by Arloc Sherman and Matt Broaddus
On September 10, the Census Bureau will release its official statistics on poverty, income, and health insurance coverage in 2018. Three points are worth noting in advance of the release.
1. Progress on Health Coverage May Have Started to Erode
The Census Bureau will issue national and state estimates of health insurance coverage for 2018, based on both its Current Population Survey (CPS) and American Community Survey (ACS). The 2018 figures in both surveys likely will show an increase in the number and share of Americans without health coverage for the first time since enactment of the Affordable Care Act (ACA), signaling an erosion of some of the historic coverage gains made under the ACA.[1] Nonetheless, the uninsured rate will almost certainly remain somewhere near its historic low because the ACA’s major coverage provisions remain in place, despite the Administration’s continuing efforts to reverse and weaken them.
Importantly, Census is revising the methodology behind the CPS’ uninsured rates this year. This means that the 2018 uninsured rate should be compared to Census’ revised 2017 uninsured rate computed under the new methodology — 7.9 percent — rather than to the somewhat higher uninsured rate originally published last year.[2]
Why is it likely that the data will show an increase in the rate of uninsured? Data from the smaller, previously released National Health Interview Survey (NHIS), which typically align with the Census data, show that the uninsured rate increased by 0.3 percentage points in 2018, amounting to about 1.1 million more uninsured people.[3] Likewise, the Congressional Budget Office (CBO) projects an uninsured-rate increase of 0.3 percentage points in 2018, based on NHIS and other data.[4] While an increase of that magnitude is not statistically significant in the NHIS due to its smaller survey sample, it would be statistically significant in both the CPS and the ACS.
A reversal of progress on health coverage in 2018 would likely reflect, at least in part, the growing impact of ongoing Trump Administration efforts to weaken health coverage under the ACA. Among these efforts, the President and Congress repealed the ACA’s individual mandate (the requirement that most people have coverage or pay a penalty). While repeal did not take effect until 2019, CBO and other experts concluded that it reduced coverage starting in 2018 due to consumer confusion.[5]
In addition, the Administration’s harsh stance against immigrants — including new policies that change how Medicaid eligibility is factored into decisions concerning who can legally enter the United States and who can adjust to lawful permanent resident status — have sowed substantial fear and confusion that has likely increased uninsured rates among individuals in families that include immigrant members.[6] Cuts to outreach and enrollment assistance and support also have reduced enrollment in the ACA marketplaces.[7] And the Administration’s support for new state policies that make it harder for people to enroll or stay enrolled in Medicaid may have contributed to the significant drops in Medicaid enrollment among children and adults in 2018.[8]
These factors will increase uninsured rates, but they likely will reverse only a small fraction of the progress made since the ACA’s enactment. Because of changes in the CPS methodology in 2014 and 2018, the ACS and NHIS are the better surveys for comparing uninsured rates over time. As Figure 1 shows, ACS data show that the uninsured rate plummeted from 15.5 percent in 2010 to 8.6 percent in 2016. Other data show that the uninsured rate in 2016 was the lowest in U.S. history — and that the drop in the uninsured rate as the ACA’s major provisions took effect was the sharpest since the creation of Medicare and Medicaid.[9] Accordingly, if the uninsured rate rises as expected in 2018, it will likely remain near its historic low.
Figure 1
The health coverage gains under the ACA have been greatest in the 32 states (including the District of Columbia) that extended Medicaid to more low-income adults by January 2017, under the ACA’s Medicaid expansion. Had the uninsured rate fallen in non-expansion states as much since 2013 as it did in expansion states, 4.5 million fewer Americans would have been uninsured in 2017.[10] Uninsured rates have fallen for virtually every racial, ethnic, gender, education, and income group that the Census data cover.[11]
Looking ahead, erosion of health coverage is expected to worsen as coverage losses from repeal of the individual mandate and administrative actions weakening the ACA marketplaces and Medicaid continue to grow, especially if various state policies restricting Medicaid coverage — a number of which have so far been blocked by federal courts — take effect. These coverage losses will be partially offset by coverage gains in additional states that have adopted the Medicaid expansion despite Administration efforts to discourage them from doing so.
The greater threat is the Administration’s continued effort to repeal the ACA, whether through litigation or legislation. The Administration recently urged an appeals court to strike down the entire law — eliminating the Medicaid expansion, the health insurance marketplaces and premium tax credits, protections for people with pre-existing health conditions, and all other ACA coverage provisions. If that position were to prevail, the Urban Institute estimates that 20 million people would lose coverage, returning the uninsured rate to slightly higher than before the ACA was enacted. [12]
2. Progress on Income and Poverty Likely Continued
Rising employment and wages in 2018 make it likely that the improvements seen in 2015, 2016, and 2017 — years in which median household income (adjusted for inflation) rose at a healthy pace and the official poverty rate fell significantly — continued last year. This could make 2018 a notable year in some respects:
* The 2014-2018 period could show the strongest four-year improvement in the official poverty rate since 1969.
* Median income may have reached a record high in 2018, with data back to 1967.
* The official poverty rate may have reached its lowest level since at least 2001.
(As the Technical Note below explains, recent methodological changes to the survey data will make it harder to judge whether these milestones have truly been reached.)
These would be welcome milestones. None, however, would signify that 2018 itself was unusually strong for a year in which the overall economy grew. Instead, they would reflect the cumulative effect of a record-long economic recovery that started in 2009 and included some years of exceptionally large drops in poverty and strong income gains. For example, in 2015 the poverty rate fell more than in any other year since 1969: from 14.8 percent to 13.5 percent, making it the only year in the last 50 in which the decline exceeded 1 percentage point. Also in 2015, median household income rose by the largest amount on record — more than 5 percent, after adjusting for inflation — with data back to 1967. (See Figure 2.)
Moreover, reaching a record high median income level is unsurprising in a growing economy. Median inflation-adjusted family income reached a high in 32 of the 60 years preceding the Great Recession. It should also be remembered that the strong gains of recent years continue a long recovery from the depths of the severe downturn that began in December 2007. Even in 2017 — the eighth full year of economic recovery from the Great Recession — median income and poverty had not quite returned to their pre-recession (2007) levels. Modest improvements in 2018 would be a welcome development but would still leave these measures barely improved over 2007. (See Table 1 in Technical Note.)
Figure 2
3. Supplemental Census Data Will Show Impact of Anti-Poverty Programs
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