Who Are the Remaining Uninsured and Why Haven't They Signed Up for Coverage?

Also read a companion post on To the Point: “Latinos and Blacks Have Made Major Gains Under the ACA But Inequalities Remain.”

Abstract

• Issue: The number of uninsured people in the United States has declined by an estimated 20 million since the Affordable Care Act went into effect in 2010. Yet, an estimated 24 million people still lack health insurance.
• Goal: To examine the characteristics of the remaining uninsured adults and their reasons for not enrolling in marketplace plans or Medicaid.
• Methods: Analysis of the Commonwealth Fund ACA Tracking Survey, February–April 2016.
• Key Findings and Conclusions: There have been notable shifts in the demographic composition of the uninsured since the law’s major coverage expansions went into effect in 2014. Latinos have become a growing share of the uninsured, rising from 29 percent in 2013 to 40 percent in 2016. Whites have become a declining share, falling from half the uninsured in 2013 to 41 percent in 2016. The uninsured are very poor: 39 percent of uninsured adults have incomes below the federal poverty level, twice the rate of their overall representation in the adult population. Of uninsured adults who are aware of the marketplaces or who have tried to enroll for coverage, the majority point to affordability concerns as a reason for not signing up.

Latinos Are a Growing Share of the Uninsured

Despite these coverage gains, each of the groups who were most at risk of being uninsured before the ACA continues to have higher uninsured rates than their demographic counterparts. Consequently, compared with the overall working-age population, uninsured adults are disproportionately poor, young, Latino, and employed by small businesses (Table 1).

As the number of uninsured adults has declined, there have been notable shifts in their composition since 2013. Latinos have become a growing share of the uninsured among racial and ethnic groups, rising from 29 percent in 2013 to 40 percent in 2016, more than twice their representation in the overall population (Exhibit 2, Table 1). In contrast, the share of whites has declined, falling from half in 2013 to 41 percent in 2016.

As of February–April 2016, of the estimated 24 million uninsured adults, 88 percent—approximately 21 million—had incomes less than 138 percent of poverty, were young adults under age 35, were Latino, and/or were working in small firms (data not shown).

Most Uninsured Adults Have Incomes that Qualify for Marketplace Subsidies or Medicaid

The vast majority of uninsured adults (94%) have incomes under 400 percent of poverty ($47,080 for an individual, $97,000 for a family of four), which makes them income-eligible for either marketplace subsidies or Medicaid (Exhibit 3).

One-third (34%) of adults who were uninsured in 2016 have Medicaid-eligible incomes but live in one of the 20 states that had not yet expanded eligibility for Medicaid at the time of the survey.² This includes adults who fall into the so-called coverage gap—that is, those with incomes under 100 percent of poverty who are neither eligible for their state’s existing Medicaid program nor marketplace subsidies (22%)—and those with incomes between 100 percent and 138 percent of poverty who are eligible for marketplace subsidies (12%).

Because young adults comprise the largest share of the uninsured across the age spectrum and because they are coveted by health insurers for their generally healthy status and lower cost risk, we took a closer look at their income profile. Like the overall adult population, the majority of uninsured young adults (96%) have incomes that make them eligible for marketplace subsidies or Medicaid. Nearly two of five (38%) uninsured young adults, an estimated 4 million, have incomes that might make them eligible for Medicaid but live in states that have not yet expanded eligibility.

Why Do Millions of U.S. Adults Remain Uninsured?

Several factors, many of which emerge in the survey findings, are likely contributing to shifts in the composition of the uninsured and higher rates of uninsurance among some groups. The factors, discussed in detail below, include:

1. the ACA’s exclusion of undocumented immigrants from the coverage expansions
2. the lack of Medicaid expansion in 19 states, including two of the nation’s largest states
3. less awareness of the marketplaces in some demographic groups
4. concerns about plan affordability and subsidy eligibility
5. difficulty selecting plans during the enrollment process
6. lack of assistance in selecting plans.

1. Undocumented Immigrants Are Not Eligible for ACA Coverage

The Affordable Care Act bars people who are not legal U.S. residents from Medicaid or marketplace coverage. This is likely a significant factor in the large number of Latinos who remain uninsured, although we do not know from the survey data what percentage of uninsured Latinos are undocumented. The Census Bureau estimates nearly half of uninsured Latinos (46%) in 2014 were noncitizens.³ Other estimates find undocumented immigrants make up about 15 percent of the remaining uninsured.⁴

In each of the high-risk demographic groups we examined, Latinos make up nearly half of the uninsured. Latinos make up 47 percent of uninsured adults earning less than 138 percent of poverty, 47 percent of uninsured young adults, and 46 percent of uninsured small-business workers (data not shown).

2. Nineteen States Have Not Yet Expanded Medicaid Eligibility

The 2012 Supreme Court decision made the ACA’s Medicaid expansion for people with income up to 138 percent of poverty optional for states. Currently, 19 states have not yet expanded eligibility. In these states—because Congress could not have anticipated the Court’s decision—people with incomes between 100 percent and 138 percent of poverty are eligible for subsidies for marketplace plans but those with incomes under 100 percent of poverty do not have access to the subsidies since it was assumed they would enroll in Medicaid. Nearly 3 million people are estimated to be in this so-called coverage gap.⁵ In addition, it is likely that many people in these states with access to subsidies remain uninsured as most plans are more expensive for enrollees, relative to Medicaid.⁶

The uninsured rate among adults with Medicaid-eligible income levels (under 138 percent of poverty) has fallen by half in the 30 states and the District of Columbia that had expanded Medicaid at the time of the survey, from 30 percent in 2013 to 17 percent in 2016 (Exhibit 4). The uninsured rate in this income group in nonexpansion states has declined only slightly; at 35 percent, it is twice the rate of Medicaid-eligible adults in expansion states.

A disproportionately large number of uninsured adults live in the 20 states that had not yet expanded Medicaid. Adults in these states comprise 41 percent of the overall adult population but make up 51 percent of the remaining uninsured (Table 1).⁷ These states, including Florida and Texas, are concentrated in the South. As a result, there is a disproportionately high number of uninsured adults in the South.

3. Less Awareness of the Marketplaces in Higher-Risk Groups

Awareness of the marketplaces has risen significantly since we first asked adults about these entities just before they opened in 2013 (see dashboard). Looking at adults who are still uninsured, 62 percent were aware of the marketplaces in 2016, compared to 79 percent of all adults (Exhibit 5 and data not shown). The demographic groups with the highest uninsured rates were least likely to know about the marketplaces.

4. Many Uninsured Adults Cite Concerns About Affordability and Eligibility

Among uninsured adults who were aware of the marketplaces, concerns about affordability were a frequently cited factor for not visiting the marketplaces and not enrolling in a health plan after they shopped for coverage. Many people were also uncertain about their eligibility for financial assistance and many discovered that they weren’t eligible once they shopped.

Nearly two-thirds (64%) of uninsured adults who were aware of the marketplaces said they had not visited one to shop for coverage because they did not think they would be able to afford coverage (Exhibit 6). Similarly—excluding people who said they got coverage someplace else—85 percent of uninsured adults who shopped for coverage but did not enroll said it was because they could not find an affordable plan (Exhibit 7).

The majority (86%) of uninsured adults who did not enroll because they could not find affordable plans had incomes that made them eligible for tax credits or Medicaid, though these data include those who may be ineligible because of their immigration status (data not shown).⁸ More than half (54%) had incomes in the range that made them eligible for subsidies (i.e., from 100 percent to 400 percent of the federal poverty level, or $11,770 to $47,080 annual income for an individual).⁹ About one-third (32%) had incomes under 100 percent of poverty. An estimated 27 percent—and thus nearly all of those with incomes under 100 percent of poverty—were likely in the Medicaid coverage gap. About 14 percent had incomes that exceeded the threshold that made them eligible for subsidies (i.e., 400 percent of poverty).

5. Adults Who Do Not Enroll in Coverage Have Greater Difficulty Comparing Health Plans

We compared the shopping experiences of enrollees and nonenrollees who were eligible for marketplace plans.¹⁰ We excluded those who told us they had enrolled in another source of coverage.

We asked people who visited the marketplaces how difficult or easy it was to compare health plans on the basis of premium costs, benefits covered, out-of-pocket costs, and provider networks.¹¹ Those who enrolled in plans were more likely than those who did not enroll to report an easy time identifying differences among plans (Exhibit 8).¹²

Similarly, adults who enrolled in marketplace plans were significantly more likely to report they had an easy time finding an affordable health plan and/or a plan with the type of coverage they needed than those who did not enroll (Exhibit 9).¹³

Overall, people who ultimately enrolled in either Medicaid or a marketplace plan were significantly more likely than those who did not enroll to give high ratings to their overall experience. (Exhibit 10).¹⁴

6. Adults Who Do Not Enroll Are Less Likely to Have Received Personal Assistance

Receiving personal assistance during the enrollment process appears to make a significant difference in whether a person signs up for coverage. People with incomes in the range that made them eligible for Medicaid or marketplace subsidies, those who are part of racial and ethnic minority groups, those with a high school education or less, and older adults were the most likely to report they had received personal assistance from a telephone hotline, insurance broker, navigator, or other source (Table 2). When we controlled for demographic differences, 77 percent of adults who said they had received assistance enrolled in a marketplace plan or Medicaid (Exhibit 11).¹⁵ In contrast, 60 percent of those who did not receive personal assistance ultimately enrolled.

CONCLUSION AND POLICY IMPLICATIONS

The health insurance reforms of the Affordable Care Act have been successful on key measures: substantial declines in the number of uninsured Americans and nationwide declines in people’s out-of-pocket spending growth, cost-related problems getting care, and medical bill problems.¹⁶ The majority of enrollees in both marketplace plans and Medicaid are satisfied with their health plans and doctors.¹⁷ And the law’s subsidies have made premiums and cost-sharing for low- and moderate-income adults enrolled in coverage through the marketplaces comparable to what people pay in employer plans.¹⁸

However, millions of people who would benefit from these reforms remain uninsured. This analysis finds that the vast majority have low incomes, are young, are Latino, and/or are working in a small firm. They are also less aware of the marketplaces than most Americans. Among those who are aware of the coverage options, or have tried to enroll, the majority point to affordability concerns as a reason for not signing up.

There are various ways more universal coverage in the United States might be achieved under the Affordable Care Act. First and foremost, all states can accept the federal dollars available to them and expand eligibility for their Medicaid programs. Second, the survey findings and other research indicate that outreach and assistance can help reach uninsured people and facilitate enrollment.¹⁹ Widespread concerns about affordability suggest that additional education is needed to inform people about their options and available subsidies.²⁰ For some eligible uninsured people, enhanced subsidies and lower cost-sharing in marketplace plans may be required to facilitate enrollment, particularly for moderate-income households and those near the income-eligibility thresholds. Finally, the growing share of Latinos in the shrinking number of uninsured people reflects both the growth of this population in the United States in general and the explicit exclusion of undocumented immigrants from the law’s coverage expansions. Immigration reform would help increase the numbers of people who are eligible for coverage, as would a loosening of the law’s restrictions on the eligibility of undocumented immigrants.

Table 1. Uninsured Rates by Demographics, July–September 2013 and February–April 2016

— Not applicable.
^a Respondent said health status was fair or poor or said they had at least one of the following chronic diseases: hypertension or high blood pressure; heart disease; diabetes; asthma, emphysema, or lung disease; high cholesterol; depression or anxiety.
^b The following states have state-based marketplaces: CA, CO, CT, ID, KY, MA, MD, MN, NY, RI, VT, WA, and the District of Columbia. All other states were considered to have federally facilitated marketplaces.
^c Thirty states (AK, AR, AZ, CA, CO, CT, DE, HI, IA, IN, IL, KY, MA, MD, MI, MN, MT, ND, NH, NJ, NM, NV, NY, OH, OR, PA, RI, VT, WA, WV) and the District of Columbia expanded their Medicaid program and began enrolling individuals in February 2016 or earlier. All other states were considered to have not expanded.
^d Base: Full- and part-time employed adults ages 19–64. Distributions may not sum to 100 percent because of “don’t know” responses or refusal to respond.
Source: The Commonwealth Fund Affordable Care Act Tracking Surveys, July–September 2013 and February–April 2016.

Table 2. Demographics of Adults Who Visited the Marketplace and Received Personal Assistance

^a Personal assistance includes calling a telephone hotline, or getting help from an insurance broker, navigator, or in some other way.
^b Respondent said health status was fair or poor or said they had at least one of the following chronic diseases: hypertension or high blood pressure; heart disease; diabetes; asthma, emphysema, or lung disease; high cholesterol; depression or anxiety.
Source: The Commonwealth Fund Affordable Care Act Tracking Survey, February–April 2016.