Program Goals:

The Program on Affordable Health Insurance envisions an efficient and equitable health insurance system that makes available to all Americans comprehensive, continuous, and affordable coverage. In support of that vision, the program seeks to:

• Analyze changes in employer-based, private and public insurance coverage for people under age 65, and determine how those changes may affect the affordability and comprehensiveness of coverage, the number of uninsured, the number of underinsured, and churning in and out of coverage
• Document the consequences of being uninsured, underinsured, and unstably insured, with regard to access to care, health status, personal financial security, and economic productivity
• Develop and evaluate federal and state policies to expand and stabilize health insurance, make it more affordable and aligned with incentives to access appropriate and high quality care, and enhance the efficiency with which it is administered.

The Affordable Health Insurance program is led by Assistant Vice President Sara R. Collins, Ph.D.

The Issues:

Employer-based coverage forms the backbone of America's voluntary health insurance system. Health plans offered by employers cover more than 160 million workers and their dependents, or 62 percent of the under-65 population. But rising health care costs have led employers to shift a greater share of their costs to employees or—as many small businesses have already done—to stop providing coverage altogether. In 2007, there were 45.7 uninsured, an increase of 7.3 million since 2000. About 25 million additional adults under age 65 could be considered "underinsured," with high out-of-pocket health care costs relative to their income. In recent national polls, Americans said expanding access to affordable health insurance is the most critical domestic policy challenge facing the nation. Opinion leaders in health policy, delivery, and finance share this view, with eight of 10 saying that expanding coverage is a top priority for Congress, according to a Commonwealth Fund survey.

Recent Projects:

Rising Numbers of Underinsured. Using data from the 2007 Commonwealth Fund Biennial Health Insurance Survey, Cathy Schoen, M.S., and Fund colleagues found that there were 25 million underinsured adults in 2007, up from 16 million in 2003, with much of the growth among people in the middle range of the income distribution. For adults with incomes above 200 percent of the federal poverty level, the underinsured rates nearly tripled since 2003.

A Health Reform Framework. Sara Collins and Fund colleagues recently published the report A Roadmap to Health Insurance for All, which presents principles for health insurance reform to help the public assess proposals based on their potential to achieve universal coverage and to move the nation's health care system toward high performance. In a related report, Building Blocks for Reform, Cathy Schoen, M.S., Karen Davis, Ph.D., and Sara Collins, Ph.D., presented a new health reform framework, built on the current mixed private–public system, that provides a pathway to universal coverage with a minimal increase in total national spending and relatively modest net federal budget costs. The authors estimate the plan would insure 44 million of the estimated 48 million Americans currently lacking coverage.

Coverage for Young Adults. Each May since 2003, The Commonwealth Fund has published an issue brief, Rite of Passage, documenting the crisis in young adults' health coverage and outlining policies that would give them access to meaningful and affordable coverage. In the 2008 edition, the authors reported further deterioration of coverage for this age group: the number of uninsured young adults climbed to 13.7 million in 2007. Twenty states have taken steps to expand coverage for this age group.

The Candidates' Health Proposals. The Commonwealth Fund published a report on the presidential candidates' health reform proposals in January 2008. A forthcoming report will compare the health reform proposals of Republican and Democratic candidates.

Extending Medicare. J. Michael McWilliams and colleagues from Harvard Medical School have published two research papers in the New England Journal of Medicine and the Journal of the American Medical Association on the use and costs of Medicare services and health status of Medicare beneficiaries who were uninsured before gaining Medicare coverage at age 65. The findings suggest that providing insurance coverage for uninsured adults in late middle age could improve their health outcomes, reduce their health care use and spending once they enter Medicare, and ultimately help to offset the costs of expanding coverage to older adults.

Health Care's Financial Burden on Families. Using data from the Medical Expenditure Panel Survey, Peter Cunningham, Ph.D., of the Center for Studying Health System Change found that rising out-of-pocket expenses and stagnant incomes increased the financial burden of health spending for families from 2001 through 2004, especially for those with insurance purchased on the individual market. His analysis was published in Health Affairs in January 2008.

Impact of Health Costs on Low-Wage Workers. Although rising health care costs affect everyone, Sherry Glied, Ph.D., and Bisundev Mahato of Columbia University have found that they pose a particular problem for low-wage workers and their families. Their Fund report showed that between 1996 and 2003, low-wage workers were more likely than high-wage workers to be uninsured, to spend a proportionally higher share of family income on out-of-pocket health costs and to report worse general and mental health. Another report by Glied and Mahato found that in 2004, uninsured and publicly insured workers and their dependents cost the public $45 billion, including $33 billion in public program insurance costs and $12 billion in uncompensated care costs.

Analysis of Health Care Bills. In partnership with Health Policy R&D and the Lewin Group, the Fund has been conducting analysis of health care bills introduced in Congress in 2007 and 2008. The first report in a two-part series will compare coverage proposals, and a second report addresses bills to improve quality and efficiency.

Future Directions:

Health care cost growth, slow income growth, and a poor economic climate will continue to put pressure on workers and businesses, likely leading to growth in the numbers of uninsured and underinsured Americans. The Affordable Health Insurance program will respond by tracking the scope of the problem and trends, measuring the consequences of being uninsured and underinsured, and providing analysis to lead and inform policies to expand health insurance.

Several Fund-supported projects will provide critical information to policymakers and the public in the national discussion over health care reform. Jon Gabel, M.A., of the National Opinion Research Center has received Fund support to compare the affordability of small-group, large-group, and individual market insurance plans, based on premiums and out-of-pocket medical expenses. He also will examine the benefit structure of plans available in individual markets in 10 states, and compare the expected out-of-pocket expenses for people enrolled in individual and group plans. In a second project, Gabel will compare the financial protection of Medicare and "Medicare Extra" to plans offered in the small, medium and large group employer market and the Federal Employees Health Benefits Program. He will measure financial protection based on comprehensiveness of coverage, expected out-of-pocket spending, levels of underinsurance and affordability.

Researchers have proposed the creation of a national health insurance connector as a way to improve the accessibility and affordability of coverage, especially for the uninsured and underinsured. Melinda Buntin, Ph.D., and colleagues at RAND will assess how the design and specific features of connector would affect the number of people who would gain coverage and their out-of-pocket costs relative to income. They also will consider strategies to adjust or equalize risk across plans to encourage insurers to compete on the basis of quality, rather than risk avoidance.

With Fund support, Niteesh Choudhry, M.D., Ph.D., of Brigham and Women's Hospital will analyze claims data of a large company to determine the impact that reduced copayments have on medication use, adherence, and discontinuation as well as on clinical outcomes, use of health services, and overall health care costs.

As the 2008 presidential election nears, the Future of Health Insurance program will continue to provide objective information about the candidates' health care reform proposals, including their potential to expand insurance coverage and put the health care system on a path to high performance.

To apply for a grant from the program, visit the Applicant and Grantee Resources page.