The Tattered Safety Net James G. Anderson, Ph.D. Purdue University

Number of Uninsured in the U.S.

Profile of the Uninsured 76.4% uninsured adults under 65 work full or part time during the year 34.9% earn more than $25,000 per year Uninsured by race and ethnicity 12.9% White 9.7% White non-Hispanic 18.5% Black 18.0% Asian and Pacific Islander 32% Hispanic

Profile of the Uninsured Uninsured by education 26.6% No high school 16.4% High school 13.4% Some college 10.3% Associate degree 7.1% BS/BA degree

Profile of the Uninsured Uninsured by income 22.7% Less than $25, % $25,000-$49, % $50,000-$74, % $75,000 or more

Profile of the Uninsured Uninsured by age 11.8% Under 18 years 27.3% 18 to 24 years 21.2% 25 to 34 years 15.5% 35 to 44 years 12.8% 45 to 64 years 0.7& 65 years and over

Uninsured Children by Race and Ethnicity Uninsured by race and ethnicity 10.9% White 7.3% White non-Hispanic 13.6% Black 14.2% Asian and Pacific Islander 24.9% Hispanic

Children Covered by Medicaid by Race and Ethnicity Uninsured by race and ethnicity 17.0% White 13.2% White non-Hispanic 35.8% Black 18.6% Asian and Pacific Islander 32.8% Hispanic

Reasons Given for Lack of Insurance 47% Insurance is too expensive 15% Job doesn’t offer insurance benefits 15% Unemployed or between jobs

Health Insurance Coverage for Children 1999

Health Insurance Coverage 2000

Health Insurance Coverage by Family Income Level 1999

Medicaid Enrollments Selected years

Medicaid Enrollment by Category 2003

SCHIP Enrollment

Medicaid Managed Care Enrollment December 31, 2001 State% in Managed Care Alaska0% Illinois9.5% Indiana71% Kentucky90.4% Ohio26.8% Tennessee100% US58.3%

What is the Safety Net? Health providers who have a legal obligation to provide free or reduced-fee care to those who could not otherwise afford it.

Why Do We Need a Safety Net? 75 million (est.) (29%) of Americans without health insurance on any given day in 2002 A cap on Medicaid enrollment would result in 67 million (24%) of population uninsured by 2002.

Access to Care by the Insured and Uninsured Type of CareInsuredUninsured Mammograms40%16% Pap Smears76%49% Prostate Exams20%12% Regular Source of Care 91%64% Routine Physical Exam 70%47% Problems Paying Medical Bills 18%39%

Who are the Safety-Net Providers? Medicaid (40.4 million low income adults, children, elderly and disabled in 2003). Safety Net Hospitals in 1997 (482 hospitals) Community and Migrant Health Centers (600 centers). Family Planning Clinics (4,000 clinics). Ryan White AIDS Program (136 projects). Health care for the homeless (129 projects). Public Health Departments. Rural Health Clinics (2,500 clinics).

Urban Public Hospitals ( ) Accounted for 7% of all hospitals. Provided 19% of all emergency room visits. Provided 18% of all outpatient visits. Nearly 50% of these patients were uninsured.

Who Pays for the Safety-Net? $129.9 billion federal funds for Medicaid in $94.3 billion in state funds for Medicaid in $17 billion federal funds for low-income hospitals in Medicaid costs consume 20% of state budgets. Local governments spent 17% of county budgets on health care in Hospitals provided $18.5 billion in uncompensated care in 1997.

Medicaid: The Insurance Safety-Net Provides coverage for 58% of those with incomes below the federal poverty line (2001: $8,590 individual; $17,650 family of four). Pays for 1 of 3 births. Provides coverage for 1 of 4 children. Provides coverage for 40% AIDS patients. Pays for 66% of nursing home care.

What Problems Do Safety net Providers Face? Marketplace pressures will make it difficult to make up losses. By 2002 hospitals will lose $20 billion in Medicaid; $14.4 billion in Medicare; $20 billion from private payers; $25 billion due to uncompensated care. Teaching and inner-city hospitals will operate at a loss; many will close. Providers will try to shift costs back to employers raising prices $1,000 per covered worker.

Strategies for Expanding Health Insurance Coverage Tax Credits. Expanding Public Programs (e.g., Medicaid, SCHIP) Combination of the two approaches.

Public Willingness to Pay 53% of the American public are willing to pay at least $30 per month to cover the uninsured 46% are only willing to pay $5 per month or nothing at all

Public Support for Reform Options 21% Expand Medicaid and SCHIP 21% Require businesses to offer private health insurance to their employees 20% Provide tax deductions and credits to help people purchase private health insurance