Why Are So Many Low-Income People In Massachusetts Still Uninsured?

By Nancy Turnbull
Harvard School of Public Health

A new report by the state’s Health Connector and the Department of Revenue has rekindled my curiosity and concern about two questions regarding Massachusetts health reform: Why does Massachusetts still have so many low-income people who are uninsured? And what can we do about it?

The Connector/DOR report presents an analysis of the health insurance status of adults in the state, based on 2009 state tax filings. The analysis uses the HC forms that most of us are required to fill out as part of our annual state tax return.

The major findings for the 2009 tax year are very similar to the analyses of the 2007 and 2008 tax filings; widespread compliance with the filing requirements (99% of the 4.7 million tax filers complied); a relatively small proportion of the 4.1 million tax filers who completed an HC form reported being uninsured for the entire year (4% or 170,000 people); and another small proportion of people (4%, or 150,000 people) had a time spell during the year in which they lacked coverage. The uninsured are disproportionately younger, and appear to be disproportionately male (although the gender of one-third of tax filers cannot be determined based on the information on the tax return). Rates of coverage were very similar in different geographical areas of the state

This is the chart that keeps me awake at night:

The good news from this figure is that only 13% of people who were uninsured for the full year (or ~22,000 people) lacked coverage because they could not find any affordable plan. Of course, now that we have a state affordability schedule, even one person who can’t find affordable coverage is an official public policy problem. But a lack of affordable coverage is not an issue for a huge number of people.

Another positive finding from this chart: only 17% of the full-year uninsured, or about 29,000, are uninsured because they chose to pay a tax penalty instead of buying affordable coverage that was available to them. This means that only 7/10 of one percent of all the adult tax filers in Massachusetts chose to pay a tax penalty rather than purchase affordable health insurance. Not the kind of widespread rejection of the individual mandate that all the strum und drang on the national level would suggest.

Troubling Numbers

What troubles me in looking at this chart is that two-thirds of the full-year uninsured, or 114,000 people, had incomes below 150% of the Federal Poverty Level (FPL). In 2009, this was less than $16,245 annually for a single person and below $33,025 for a family of four. The percent was similar in the 2008 Connector/DOR report. Most adults in Massachusetts at this income level should be eligible for Commonwealth Care with no premium to pay, and some would be eligible for Medicaid, also with no premium to pay. The exceptions would be people otherwise eligible for Commonwealth Care who have employer-sponsored coverage available to them, people who are undocumented, and legal non-citizens with special status who cannot get into the Commonwealth Care Bridge program, which has capped enrollment. The number of people in these groups among tax filers would be relatively small. So this means that most of the uninsured in the state are eligible for free public health insurance.

The story is similar for tax filers who were uninsured for part of the year in 2009 (see figure below). If you look at the tax filers who had a spell of uninsurance longer than the permissible three or fewer consecutive months, more than half had incomes below 150% of the federal poverty level (56,000 people out of the 100,500 who did not have a permissible gap in coverage).

It’s not a surprise that many people who are eligible for public health insurance programs are not enrolled. We know from decades of experience with the Medicaid program that only about 60% of adults who are eligible for the program actually enroll. Massachusetts does better than almost any other state in finding and enrolling adults in Medicaid; our rate of enrollment exceeds 80% (and is nearly 100% for children). Many of the states with the worst rates of Medicaid enrollment (e.g., Florida, Texas) will have the largest number of people newly eligible for Medicaid in 2014 when the federal health reform expansions go into effect. (If you’re interested in this issue, here’s a terrific article by my HSPH colleagues Ben Sommers and Arnie Epstein.) The key to realizing the promise of federal health reform will be finding and enrolling as many of these newly eligible people in Medicaid as possible, as well as getting other low- and moderate-income people to sign up for subsidized coverage through the exchanges.

Reaching The Uninsured

Despite the tremendous progress Massachusetts has made in expanding health coverage, we clearly have lots more work to do to reach the many low-income people who are still uninsured. I don’t accept the argument made by some people that there is some maximum “ceiling” of insurance coverage which is impossible to pierce. Here are a couple of things I’d like to see the state do:

–Analyze the state tax filings to determine how many of the low-income people who were uninsured in 2009 were also uninsured in 2008. This would help us understand if this is largely a static group that is continually uninsured or a changing group of people.

–Increase outreach to low-income individuals who are “chronically” uninsured to try to get them enrolled in coverage. Now that we have the state tax filing information, it’s possible to identify low-income individuals who are uninsured year after year, and develop some new strategies and initiatives to help them enroll in public programs for which they are eligible. Advocates and community-based organizations need to be key partners with the state in thinking through how to best attack this problem.

Of course, if we were to be successful in getting most of the low-income uninsured into public programs, this would have a significant impact on spending for Commonwealth Care and Medicaid. Let’s add this to the growing list of reasons why we need to get health care costs and spending under control. But allowing 100,000 people who are likely eligible for public programs to remain uninsured is not an acceptable cost containment strategy.

Highest Health Care Spender: Massachusetts

PS: Speaking of health care spending, we’re #1 again! According to an article on personal health care spending by state in the most recent version of Medicare and Medicaid Research Review, Massachusetts had the highest health spending per capita of any state in 2009, at $9,278, 36% higher than the US average. In terms of recent spending growth, the article found that over the period 2004-2009, Massachusetts was tied for 5th place among states, with an annual growth rate of 5.8%, higher than every state but Alaska (6.9%), New Mexico (6.6%), New Hampshire (6.5%, and Hawaii (6.0%) and tied with Wyoming and Washington.

If Rachel and Carey will let me, I’ll blog soon about the interesting patterns of Medicare and Medicaid spending by state in this article because I sense a battle about to heat up about cost-shifting, that favorite boogey-man of private health insurers who don’t want to admit that they have insufficient power to address a dysfunctional market because it might lead to r-e-g-u-l-a-t-i-o-n.

(Nancy, of course we will!)

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  • Suzanne Curry

    Thanks for this post, Nancy.  Local community organizations are key partners in reaching hard-to-reach uninsured populations.  With the inception of Massachusetts health reform, state policymakers recognized this and created a grant program to fund outreach, education, enrollment, and retention activities at local, trusted community organizations and community health centers.  This funding is due to run out at the end of this month, and I know of several organizations that are shutting down or reducing services due to lack of funding.  We need to make sure the state continues to invest in this outreach, education, enrollment, and retention work – it could mean the difference between reaching the “chronically” uninsured and maintaining the status quo, or worse, regressing. 

  • Nancy

    Admquilton:  Thanks for your comment. One can certainly debate what is “affordable,” and I know that many people make hard choices between buying health insurance and other necessities, and that some people pay the penalty because it is less expensive and allows them to pay for other life necessities. You are right that there are a lot of vertical and horizontal inequities in our current system. I would much prefer a tax-financed system in which everyone at the same income level made the same contribution for coverage, instead of the unfair and regressive employer-based system through which most of us are covered, and a public system that doesn’t necessarily treat people at the same income level in a consistent fashion. So far, that’s not the system we have created but it’s one that I would support.

    We could, I am sure, have a lively debate about what health benefits should be mandated.  People at different ages, and with different health needs, often see this issue very differently. Using one of your examples:  I don’t smoke but am happy to pay for smoking cessation benefits because I think it improves population health and reduces smoking-related disease and costs in the long-run, which benefits me and society more generally.   However, I agree with you about not covering aspirin through health insurance.

    Please don’t bash Harvard graduates because you disagree with me because I didn’t go to Harvard.  Perhaps if I had, I’d be better educated, who knows.


  • Admquilton

    It is illustrative that the Harvard educated pin so much of their opinions on data about the impoverished, because such research can be so comforting by a brick fireplace. Parsing the data acquired from the penalized on whether or not HC is “affordable” no matter how qualified, is a huge mistake. Venture beyond the walls of the Yard and you will most certainly find that the answer so many take the penalty is indeed its affordability by comparison to a MassHealth Connector plan. We, the healthy young men of Massachusetts do not need a plan that covers aspirin or quit smoking treatment or ADHD medicine. We need our money to start a life.

    You needn’t field the general populace. Just ASK ONE of these people what the difference in cost can be. Is it affordable, say, with respect to the amount of additional time it would take to save for a down payment on a home? Or perhaps towards a reliable car, or for a child’s higher education? Most certainly not. And yet, you will persist, “there must be a way these young men can find an affordable plan under universal coverage while still saving money.” No, there isn’t. The system itself is unsustainable on a macro scale, nevermind its negative microeconomic value. What we the people of Massachusetts need, is not saving from our own individual destruction, but saving from the imposed designs of Harvard graduates and their complicit economists.Signed, your healthy 18-35 year old male.