Contrary to earlier recessions, the Affordable Care Act’s (ACA) coverage expansions provided a safety net for those who lost their jobs and access to health coverage. The coronavirus epidemic resulted in significant disruptions to the economy and the health care system. By extending Medicaid coverage to many low-income people and offering subsidies for Marketplace coverage to anyone earning less than 400% of the federal poverty level (FPL), the Affordable Care Act (ACA) aimed to close the holes in our healthcare system that left millions of people without health insurance.
Additionally, policies were put into place during the pandemic, such as the requirement that states maintain continuous enrollment for Medicaid enrollees and the enhanced Marketplace subsidies, which protected people from coverage losses and increased the affordability of private coverage, making it easier for low-income people who were most affected by the pandemic to obtain and maintain coverage.
As a result, after rising for three years in a row from 2017 to 2019, the number of non-elderly uninsured persons reduced by over 1.5 million, from 28.9 million in 2019 to 27.5 million in 2021, and the uninsured rate decreased from 10.9% in 2019 to 10.2% in the same period.
This issue brief investigates the characteristics of the uninsured population in 2021, patterns in health coverage during the second year of the pandemic, and the access and financial costs of not having insurance. This research compares health coverage statistics for 2021 to data for 2019 using data from the American Community Survey (ACS); due to disruptions in data collecting during the pandemic, the Census Bureau did not produce 1-year ACS estimates in 2020.
How many people lack health coverage?
After several years of coverage losses before to the start of the pandemic, the uninsured rate decreased from 2019 to 2021, mostly as a result of increases in Medicaid coverage While low-income people and those with working families experienced bigger coverage gains than those with higher incomes and those without a worker in the home, Asian and Hispanic non-elderly people saw more coverage gains than their White counterparts.
The number of uninsured people is still significantly lower than it was before the Affordable Care Act was passed. The number of non-elderly people without insurance decreased from more than 46.5 million in 2010 to less than 26.7 million in 2016, up to 28.9 million people in 2019, and then decreased once more to 27.5 million people in 2021. Since Medicare provides nearly universal coverage for the elderly, with only 441,000, or less than 1%, of individuals over 65 being uninsured, our focus is on coverage among non-elderly people.
In 2021, the uninsured rate decreased, following a rise from 2017 to 2019. The number of persons without health insurance fell by 1.5 million from 2019 to 2021, while the uninsured rate dropped from 10.9% to 10.2%.
In 2021, an increase in Medicaid coverage and a lesser rise in non-group coverage, which includes coverage in the Marketplaces, were the main factors contributing to the decline in the number of persons without health insurance. These coverage improvements are a result of federal policies intended to maintain coverage, especially Medicaid coverage, during the pandemic.
In exchange for increased federal funding, the Families First Coronavirus Response Act (FFCRA) has provisions that forbid states from removing patients from Medicaid until one month after the COVID-19 public health emergency (PHE) has ended.
The Inflation Reduction Act of 2022 (IRA) extended the American Rescue Plan Act’s (ARPA) improved ACA Marketplace subsidies for an additional three years. As a result, the proportion of persons having non-group coverage climbed from 6.9% in 2019 to 7.3% in 2021, while the proportion of people covered by Medicaid increased by 1.5 percentage points, from 21.0% in 2019 to 22.5% in 2021.
At the same time, the proportion of people with employer-sponsored insurance decreased from 58.1% in 2019 to 57.0% in 2021, perhaps as a result of disruptions to employment brought on by the epidemic.
According to administrative data, Medicaid coverage has increased more than the ACS predicted. In December 2021, there were 87 million people registered in Medicaid, up from 68 million in 2021, according to data from the Centers for Medicare and Medicaid Services (CMS). This represents an almost 22% growth since February 2020.
Different methods of counting people can account for some of the variance, but other respondents may give false information about their source of insurance because they are unaware that they are covered by Medicaid.
Additionally, lower income individuals who are more likely to be covered by Medicaid are frequently undercounted in statistics from national surveys. These differences have always existed, but they seem to have multiplied during the pandemic.
Hispanics experienced the greatest drop in their uninsured rate in 2021, which fell from 20.0% to 19.0%. Whites’ uninsured rate dropped from 7.8% to 7.2%, Blacks’ from 11.4% to 10.9%, and Asians’ went from 7.2% to 6.4%. The uninsured rates for those who identify as American Indian, Alaska Native, or Native Hawaiian and Other Pacific Islander (NHOPI) in 2021 were similar to those in 2019.
Compared to children, non-elderly adults experienced stronger coverage growth. The percentage of non-elderly people without insurance decreased by over 0.8 percentage points from 12.9% in 2019 to 12.2% in 2021, while the percentage of children without insurance decreased by a less dramatic 0.3 percentage points from 5.6% to 5.3%. While the percentages of non-elderly adult Medicaid coverage increased similarly for both children and adults, the loss in employer-sponsored coverage was greater for children, lowering the overall gains in coverage.
The number of uninsured people changed in different ways in each state in 2021. The number of non-elderly uninsured people fell in 22 states in total, including 5 non-expansion states and 17 Medicaid expansion states.
Although it was less than half as high (7.7% vs. 15.1%) for the group of expansion states than non-expansion states. In 2021, there was no statistically significant rise in the proportion of uninsured in any state.