Ps i Ns United States General Accounting Office Report to the Chairman, Subcommittee on Health for Families and the Uninsured, Committee on Finance, U.S. Senate May 1990 elOvUOIUsl INSURANCE A Profile of the Uninsured in Michigan and the United States GAO/HRD-90-97 '' ra '' GAO Background United States KL G- General Accounting Office Washington, D.C. 20548 14 9 6 Human Resources Division 99s B-239251 [9770 May 31, 1990 Publ The Honorable Donald W. Riegle, Jr. Chairman, Subcommittee on Health for Families and the Uninsured Committee on Finance United States Senate Dear Mr. Chairman: This report responds to your request and subsequent discussions with your Subcommittee staff for information on the characteristics of indi- viduals without health insurance in Michigan and the United States. In response to your request, we developed data on income, employment, age, marital status, and other characteristics of uninsured individuals using Bureau of the Census Current Population Survey data for 1987, the latest year data were available when we began our work. (See app. I for details on the survey.) Over 30 million Americans are not covered by health insurance, one of the most important strands in the social safety net. Estimates of unin- sured populations suggest that considerable gaps remain in the health insurance coverage of our nation’s citizens despite the almost 100- percent coverage of the elderly through Medicare, the expansions in Medicaid coverage, and an increase in protection provided through employer/union-sponsored health plans. Although the primary means of getting private health insurance is through employment, most of the uninsured are employed. This lack of health insurance has prompted intense scrutiny in the Congress, mani- fested most recently by the Pepper Commission’s recommendations for universal insurance coverage.! 1On March 2, 1990, the U.S. Bipartisan Commission on Comprehensive Health Care, formerly the Pepper Commission, released its recommendations to the Congress on “Access to Health Care and Long-Term Care for All Americans.” Page 1 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' Results in Brief GAO’s Analysis B-239251 In 1987, more than 35 million persons (under age 65)? in the United States did not have some form of health insurance coverage.* More than 860,000 of these uninsured individuals were Michigan residents. The numbers of uninsured in Michigan have fallen below the peak level experienced in 1984 when more than 1 million persons were without health insurance. Nevertheless, the uninsured population is still one of the more prominent public health issues in Michigan and the nation. Michigan’s uninsured population has many of the same characteristics as those embodied in the national uninsured population. A high percent- age of uninsured people were among the lower income, minority, youth, and unmarried segments of the population. Most uninsured people in Michigan live in families with an employed worker. Mirroring national patterns, more than 30 percent of the uninsured worked full time or full year, but a higher percent of uninsured (more than 40 percent) was among part-time/part-year workers. Also, the uninsured rate for work- ers in the service industries was 10 percent in 1987. As the part-time- worker population and employment in the service industries grow and become a more important component of a more diversified Michigan economy, solutions to the problem of the working uninsured become more important. Michigan Had 10.8 Percent Uninsured in 1987 The probability of being uninsured varies depending on where people live. Even though Michigan’s 10.8-percent uninsured rate was among the lowest (43rd) of the 50 states and the District of Columbia, there still were more than 860,000 uninsured persons in the state. Uninsured rates among the states ranged from about 8 percent in Minnesota to more than 28 percent in New Mexico. The higher rates tend to cluster in the South Central section of the United States. The percentages of uninsured per- sons by state are shown in figure 1. As the majority, about 99 percent, of individuals 65 and older had Medicare or private insurance, this age group was not included in our study. 3Estimates of the number of uninsured persons in 1987 range from 31 to 35 million. The lower figure, 31 million, is a revised estimate based on analysis by others, of questions added to the March 1988 Current Population Survey. The questions centered around health insurance coverage of children through private insurance provided by sources outside the household or by Medicaid. The revised estimate primarily affects analyses of uninsured that include children and has no effect on rates of insurance by income and employment presented in this report. Page 2 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 Figure 1: Uninsured by Percent of State Populations (1987) From 10 thru 14 percent From 15 thru 19 percent From 20 thru 24 percent (includes the District of Columbia) ee From 25 thru 29 percent Among the nine geographic regions in the United States, uninsured rates ranged from about 10 percent in New England to about 25 percent in the West South Central region. The East North Central region, of which Michigan is a part, had the third lowest percentage (12.6 percent) of Page 3 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 uninsured when compared with the other eight regions (see app. II for uninsured rates by regions and states). Proportion of Uninsured Declines in Michigan The percentage of people with health insurance coverage in Michigan was greater than the national percentage. In 1987, about 84 percent of the nation’s population under age 65 had some form of health insurance coverage. In Michigan, 89 percent of the population was covered, exceeding the national rate by 5.6 percentage points. The recent trend shows that the portion of Michigan’s population not covered by health insurance began to decline in the mid 1980s. From 1984 to 1986, the level of uninsured declined from 13.3 to 11.9 percent in Michigan, while the national rate was more stable, edging down from 17.8 to 17.6 per- cent (see fig. 2). There were further reductions in the uninsured rate from 1986 to 1987, for both Michigan and the nation (the 1987 rates were 10.8 and 16.5 percent, respectively), but these changes reflect, in part, a change in the way the Current Population Survey measured the uninsured, making it difficult to assess whether the change in 1987 reflects any real improvement in the level of health insurance coverage.‘ 4In addition to added questions on children’s health insurance coverage, the March 1988 Current Population Survey contained changes in the way individuals were asked questions about their insur- ance coverage. Because of these changes, the Bureau of the Census suggests that caution be exercised in interpreting the 1987 uninsured rate changes. Page 4 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 Figure 2: Percent of Population Uninsured in the United States and Michigan (1982-87) 20 Percent Uninsured Note: Includes only people under age 65. Source: Bureau of the Census, Current Population Survey (Washington, D.C., 1987). Employer/Union- Sponsored Health Insurance Coverage Increases Most of the nation’s insured population obtained health insurance cover- age through employer- or union-sponsored health insurance plans, which increased from 1985 to 1987 (see table 1). Likewise, the majority of the improvement in Michigan’s level of health insurance coverage since 1984 comes from an increase in employer- or union-sponsored insurance, a reflection of the pronounced improvements since 1984 in Michigan’s manufacturing sector, which has traditionally provided health insurance coverage for its workers. The federally sponsored Medicaid program coverage rate in Michigan decreased about 4 percent, resulting in a 30-percent decline in the number of persons under age 65, covered by Medicaid, whereas in the United States, Medicaid coverage increased slightly. Page 5 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 Table 1: Health Insurance Coverage of Individuals Under Age 65 in the United States and Michigan (1985 and 1987) Number of individuals is in thousands United States Michigan 1985 1987 1985 1987 Type of insurance No. Percent No. Percent No. Percent No. Percent Private Employer- or union-sponsored 134,570 64 142,747 67 5,363 66 5,803 73 Individual-provided 15,370 7 12,470 6 525 7 474 6 Public (federal) Medicaid 14,250 7 14,861 7 996 12 694 9 Medicare 2,510 1 2,095 1 118 2 96 1 CHAMPUS:, Veterans Affairs, Military Health® 5,820 3 5,287 3 83 1 50 1 Subtotal 172,520 82 177,460 84 7,085 88 7,117 89° No insurance coverage 36,900 18 35,167 17 1,003 12 861 11 Total 209,420 100 212,628° 100° 8,089° 100 7,977¢ 100 “The Civilian Health and Medical Program of the Uniformed Services is operated by the Department of Defense. It provides reimbursement for covered medical care rendered in civilian facilities to wives and children of active military personnel, retired military personnel, and their dependents, and dependents of deceased personnel. >Armed Forces members and their dependents living in off-base housing or on-base military housing. °Numbers do not add to total due to rounding. Job Growth, Uninsured Workers Concentrated in Service Sector Nearly all of the employment growth in both Michigan and the United States occurred in the service sector of the economy. However, the ser- vice industry uninsured rates were much higher than those in other sec- tors of the economy. While the uninsured rate was much lower in the manufacturing sector, particularly in the durable goods industries, employment growth was negligible. Overall, Michigan’s uninsured rates were lower than the United States’ rates in both the manufacturing and service sectors even though its employment growth rates were lower (see tables 2 and 3). Nevertheless, solutions to the working uninsured problem become more important as the service industries grow and become a larger share of a more diversified Michigan economy. Page 6 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 Table 2: Percent of Uninsured Workers (1987) and Employment Growth in United States, by Industry (1985-87) Percent of uninsured in Percent of combined Employment employment industry category __(thousands) _— growth or Combined industry categories (1987) 1985 1987 decline Manufacturing (durable and nondurable) 10 22300 22,166 -1 Services 14 70,745 74,704 6 Other 20 =20,133 = 20, 184 0 Total 113,178 117,054 Notes: 1. The data in this table are based on individuals aged 19-64, who responded to employment industry- related questions. 2. For a detailed breakdown of employment categories for the United States, see appendix Ill. Table 3: Percent of Uninsured Workers (1987) and Employment Growth in Michigan, by Industry (1985-87) Percent of uninsured in Percent of combined Employment employment industry category __(thousands) _ growth or Combined industry categories (1987) 1985 1987 decline Manufacturing (durable and nondurable) 6 1,183 1,199 1 Services 10 2,415 2,683 11 Other 18 523 546 4 Total 4,121 4,428 Note: The data in this table are based on individuals aged 19-64, who responded to employment indus- try-related questions. Family Income an Important Indicator of Insurance Status Those with low incomes are more likely to be without health insurance coverage. In Michigan, more than 26 percent of persons in families with incomes below the 1987 federal poverty level were uninsured. Michi- gan’s uninsured rate among the poverty population is considerably lower than the 37-percent rate in the United States (see table 4). Total annual money earnings for the majority of uninsured workers were less than $10,000 in 1987. Page 7 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 Table 4: Percent Uninsured for Individuals Under Age 65, by Income Class (1987) United States Michigan Ratio of family Population in Population in income to income class Percent in income class Percent in poverty (thousands) income class (thousands) income class Under 1.0 31,180 37 1,088 26 1.0-1.99 36,150 29 1,110 20 2.0 and over 145,300 9 5,779 6 Total 212,630 17 7,977 11 Lack of health insurance coverage is not restricted to the low-income population. In 1987, more than one-third of all the uninsured were in families with incomes at least twice the poverty level (see table 5). About 13 percent of Michigan’s uninsured workers earned $20,000 or more in 1987 (see table 6). Table 5: Distribution of the Uninsured Population Under Age 65, by Income Level (1987) Distribution of uninsured United States Michigan Ratio of family Number Percent of Number Percent of income to uninsured uninsured uninsured uninsured poverty (thousands) population (thousands) population Under 1.0 11,570 33 285 33 1.0-1.99 10,560 30 220 26 2.0-4.99 10,680 30 282 33 5 and over 2,360 7 74 9 Total 35,170 100 861 1002 *Numbers do not add to total due to rounding. Table 6: Income Levels of Uninsured Workers in Michigan, Aged 19-64 (1987) Uninsured workers (percent) Full-time/ Part-time/ Personal income full-year part-year Total $1-9,999 15 40 55 10,000-19,999 18 15 33 20,000-29,999 6 1 7 30,000-39,999 2 0 3 40,000 and over 2 1 3 Total 43 57 100? *Numbers do not add to total due to rounding. Page 8 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. ''> B-239251 Many Employed People Are Uninsured Though unemployed people had the highest uninsured rate among the different employment categories, many employed people also were with- out health insurance coverage. Most of the working uninsured in Michi- gan were part-time/part-year workers’ (see tables 7 and 8). But even full-time or full-year workers were not assured of health insurance cov- erage. Nearly one-third of Michigan’s uninsured workers had full-time jobs in 1987. Table 7: Uninsured As a Percent of the Population Aged 19-64, by Employment Status (1987) [SSN ea SSS a ed Te Figures in percent Distribution United States Michigan Employment status uninsured uninsured Full-time/full-year 10 t Part-time/part-year 22 14 Unemployed 42 418 Not in work force 18 11 @Sampling error is plus or minus 13 percentage points at the 95-percent confidence level. Table 8: Distribution of Uninsured Individuals Aged 19-64, by Employment Status (1985 and 1987) ESAS POLO We ree NE OD ele ee Figures in percent Distribution United States Michigan Employment status 1985 1987 1985 1987 Full-time/full-year 28 35 27 32 Part-time/part-year 44 42 46 41 Unemployed or not in work force 28 24 27 28 Total? 100 100 100 100 @Numbers may not add to total due to rounding. Demographic Characteristics of the Uninsured The likelihood of being uninsured is greater among the youth, minori- ties, the unmarried, and those who do not have a college education com- pared with others in the same demographic category. In Michigan, the uninsured rates were high for people that were aged 19-24 (17 percent), Hispanic (22 percent), and black (17 percent), compared with about 10 percent white; unmarried or separated (from 15 to 20 percent compared with 5 percent of married persons); and had no more than a grade >The Bureau of the Census’ Technical Documentation for the Current Population Survey states that part-time workers include people who worked less than 35 hours per week in a majority of the weeks worked during the year. People who worked full time for less than 50 weeks are considered part-year workers by Census. Page 9 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 school education (about 20 percent compared with 6 percent of those completing 1 or more years of college). This pattern in Michigan was consistent with that of the nation (see tables 9 and 10 and figures 3 and 4). Table 9: Percent of Population Uninsured, by Age Group (1987) Uninsured (percent) Ranges of ages in years United States Michigan 55-64 11 7 45-54 11 5 35-44 12 8 25-34 17 13 19-24 25 17 18 and younger 20 12 Figure 3: Percent of Population Uninsured, by Race or Ethnic Origin (1987) 50 = Percent of population 30 Hispanic Other Note: Includes only people under age 65. *Sampling error is plus or minus 11 percentage points at the 95-percent confidence level for Hispanics in Michigan. Source: Bureau of the Census, Current Population Survey (Washington, D.C., 1987). Page 10 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 Table 10: Uninsured Under Age 65, by Marital Status (1987) ERE FPP EYE ONDE We BS POE Figures in percent Uninsured Marital status United States Michigan Married 10 5 Widowed 23 238 Divorced or separated 22 15 Never married 24 20 aSampling error is plus or minus 10.7 percentage points at the 95-percent confidence level. Figure 4: Percent of Population Uninsured, by Education Level (1987) 50 Percent of population Grade school High school [ United States Michigan Note: Includes only people under age 65. 4Sampling error is plus or minus 8 percentage points at the 95-percent confidence level for the grade school group in Michigan. Source: Bureau of the Census, Current Population Survey (Washington, D.C., 1987). Objectives, Scope, and Methodology We agreed to focus our work on identifying and comparing the charac- teristics of uninsured people in the United States and Michigan. Addi- tionally, we developed statistics on changes in the uninsured population over a recent period. Page 11 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' B-239251 To determine the growth in the number of uninsured and characteristics of uninsured individuals under age 65, we analyzed the Bureau of the Census’ Current Population Survey data for 1982 through 1987. For most of our analyses we used Census survey data collected for 1987. The data collected for 1988 were not available when we began our analysis. We are sending copies of this report to the Secretary of Health and Human Services and will make copies available to others on request. As agreed with your staff, we did not obtain agency comments on this report. If you or your staff have questions concerning this report, please call me on (202) 275-5451. Other major contributors to this report are listed in appendix IV. Sincerely yours, Pilaed Li Fadel Mark V. Nadel Associate Director, National and Public Health Issues Page 12 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' Page 13 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' Contents Letter 1 Appendix I 16 Current Population Survey Appendix II 18 Uninsured Populations, by Region and State (1987) Appendix III 20 Uninsured Rates for Workers (1987) and Employment Growth in the United States, by Industry Group (1985-87) Appendix IV 21 Major Contributors to This Report Tables Table 1: Health Insurance Coverage of Individuals Under 6 Age 65 in the United States and Michigan (1985 and 1987) Table 2: Percent of Uninsured Workers (1987) and 7 Employment Growth in United States, by Industry (1985-87) Table 3: Percent of Uninsured Workers (1987) and 7 Employment Growth in Michigan, by Industry (1985-87) Table 4: Percent Uninsured for Individuals Under Age 65, 8 by Income Class (1987) Page 14 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' Contents Figures Table 5: Distribution of the Uninsured Population Under 8 Age 65, by Income Level (1987) Table 6: Income Levels of Uninsured Workers in 8 Michigan, Aged 19-64 (1987) Table 7: Uninsured As a Percent of the Population Aged 9 19-64, by Employment Status (1987) Table 8: Distribution of Uninsured Individuals Aged 9 19-64, by Employment Status (1985 and 1987) Table 9: Percent of Population Uninsured, by Age Group 10 (1987) Table 10: Uninsured Under Age 65, by Marital Status 11 (1987) Figure 1: Uninsured by Percent of State Populations 3 (1987) Figure 2: Percent of Population Uninsured in the United 5 States and Michigan (1982-87) Figure 3: Percent of Population Uninsured, by Race or 10 Ethnic Origin (1987) Figure 4: Percent of Population Uninsured, by Education 11 Level (1987) Abbreviations CHAMPUS Civilian Health and Medical Program of the Uniformed Services Page 15 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. ''Appendix I Current Population Survey The Bureau of the Census’ Current Population Survey is the source of official government statistics on employment and unemployment. For the survey, households are scientifically selected on the basis of area of residence to represent the nation as a whole, individual states, and other specified areas. The current sample consists of about 60,000 households. The universe is the civilian noninstitutional population of the United States and members of the Armed Forces living with their families in civilian housing units or on a military base. A probability sample is used in selecting housing units. Each household is interviewed once a month for 4 consecutive months during a 1-year period, and again for the cor- responding time period a year later. This technique enables Census to obtain month-to-month and year-to-year comparisons at reasonable cost. The Current Population Survey also provides monthly labor force data, including supplemental data on work experience, income, noncash bene- fits, and migration. Comprehensive information is collected on the employment status, occupation, and industry in which individuals work. Additional data are available on the number of weeks and hours per week individuals worked and individuals’ total income. Although the main purpose of the survey is to collect data on the employment situa- tion, an important secondary purpose is to gather information on the demographic status of the population. This includes age, sex, race, mari- tal status, educational attainment, and family structure. The results serve to update similar information collected once every 10 years through the decennial census. Government policymakers and legislators use the data as important indicators of our nation’s economic situation and to plan and evaluate many government programs. In addition, the survey provides current estimates of the economic sta- tus and activities of the nation’s population. Because it is not possible to develop one or two overall figures (such as the number of unemployed) that would adequately describe the whole complex of labor market phe- nomena, the survey is designed to provide a large amount of detailed and supplementary data. Such data are made available to users of labor market information to meet various needs. The survey provides the only data available on the distribution of work- ers by number of hours worked (as distinguished from aggregate or average hours for an industry). This permits separate analyses of part- time workers, workers on overtime, and other groups. Also, the survey is the only comprehensive, current source of information on the occupa- tion of workers and the industries in which they work. Not only is infor- mation available for people currently in the labor force, but also for Page 16 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' Appendix I Current Population Survey those outside the labor force. Thus, the characteristics of the latter— including married women with or without young children, disabled per- sons, students, and older retired workers—can be determined. The Current Population Survey was not designed to capture representa- tive samples of state uninsured populations that would enable users to make refined estimates of some characteristics of the uninsured. Because of the many different variables we analyzed on the Michigan uninsured population, users of this report should exercise caution when interpreting these data because sampling errors would vary depending on the sufficiency of the population base. Unless otherwise indicated, sampling errors for the data in this report were 5 percentage points or less at the 95-percent confidence level. Page 17 GAO/HRD-90-97 Uninsured in Michigan and in the US. ''Appendix II Uninsured Populations, by Region and State (1987) Number of Uninsured as a uninsured percent of state Region/state (thousands)? population East North Central Illinois 1,326 13 Indiana 824 17 Michigan 861 11 Ohio 1,219 13 Wisconsin 402 10 East South Central Alabama 671 19 Kentucky 623 19 Mississippi 535 24 Tennessee 743 18 Middle Atlantic New Jersey 736 11 New York 2275 15 Pennsylvania 1,051 11 Mountain Arizona 645 21 Colorado 462 16 Idaho 178 21 Montana 141 20 Nevada 188 20 New Mexico 376 29 Utah 223 15 Wyoming 60 15 New England Connecticut 223 9 Maine 110 11 Massachusetts 496 10 New Hampshire 114 12 Rhode Island 88 10 Vermont 59 13 Pacific Alaska 100 21 California 5,090 20 Hawaii 115 12 Oregon 443 19 Washington 662 17 (continued) Page 18 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '' Appendix I Uninsured Populations, by Region and State (1987) Number of Uninsured as a uninsured percent of state Region/state (thousands)? population South Atlantic Delaware 84 15 District of Columbia 107 21 Florida 2,384 23 Georgia 841 16 Maryland 508 13 North Carolina 1,041 19 South Carolina 460 16 Virginia 732 14 West Virginia 271 17 West North Central lowa 263 10 Kansas 293 14 Minnesota 300 8 Missouri 588 13 Nebraska 191 14 North Dakota 58 10 South Dakota 110 18 West South Central Arkansas 552 26 Louisiana 837 21 Oklahoma 651 23 Texas 3,860 26 9Excludes ages 65 and over. Page 19 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. ''Appendix II Uninsured Rates for Workers (1987) and Employment Growth in the United States, by Industry Group (1985-87) Percent of Percent of Employment employment uninsured ___ (millions) _—s—s growth or Industry (1987) 1985 1987 decline Public administration 6 5.39 5.75 7 Manufacturing (durable) 9 13.32 13.09 =2 Finance, insurance, and real estate 9 TAT 8.07 13 Mining 9 1.11 0.78 —30 Transportation, communication, and other public utilities 11 7.97 8.25 4 Professional and related services 8 23.02 24.34 6 Wholesale trade 11 4.53 4.63 2 Manufacturing (nondurable) 12 8.98 9.08 1 Retail trade 21 18.32 18.90 3 Business and repair services 21 6.57 7.04 7 Entertainment and recreation 21 1.36 1.42 4 Construction 26 782 7.89 1 Personal services, including private households 27 4.40 4.56 4 Agriculture, forestry, and fisheries 31 3.24 3.26 1 Page 20 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. ''Appendix IV Major Contributors to This Report Janet L. Shikles, Director, Health Financing and Policy Issues, Human Resources (202) 275-5461 Division, Michael F. Gutowski, Assistant Director Washington, D.C. James O. McClyde, Assignment Manager David W. Bieritz, Evaluator-in-Charge Paula J. Bonin, Computer Specialist (108734) Page 21 GAO/HRD-90-97 Uninsured in Michigan and in the U.S. '''''''' Requests for copies of GAO reports should be sent to: U.S. General Accounting Office Post Office Box 6015 Gaithersburg, Maryland 20877 Telephone 202-275-6241 The first five ey} of each report are free. Additional copies are PRI Ry: co There is a 25% discount on orders for 100 or more copies mailed to a single address. Orders must be prepaid by cash or by check or money order made out to the Superintendent of Documents. '' United States ae Tl General Accounting Office Es ope adie ae Washington, D.C. 20548 GAO Official Business sh al Penalty for Private Use $300 ''U. C. BERKELEY LIBRARIES wiki co44adsiel ''