Marketplace Scratch Pad

Bogus number?

Scott Jagow Jun 17, 2009

The one number that gets repeated over and over in the health care debate is: 47 million Americans have no health insurance. But if you break that number down a bit, you realize that it is a very misleading statistic.

Let’s start with the “unenthusiastic uninsured“. That’s a quote from Stephen Malanga of Real Clear Markets:

Among this group are people called ‘invincibles’ in industry slang, that is, well-employed, healthy twenty and thirty-something adults who think medical insurance–even just co-pays for employer-provided plans–is a waste of money.

Meanwhile others, mostly low-income uninsured, have remained ignorant of expanding government programs designed to help them–often despite extensive outreach programs by government agencies and health advocates. Others apparently can’t be bothered going through the bureaucracy to enroll in these subsidized programs. Instead, they just do what they’ve always done if they or their kids get sick–head to the local emergency room knowing they’ll get treatment that someone will pay for.

Malanga points out that the stories we hear most are about those who want health insurance but can’t get it. But what about those who can afford insurance but don’t want it?

A study two years ago by Urban Institute scholars found that 19 percent of the uninsured in America, or roughly nine million people, were in households earning more than three times the poverty level, which the study broadly defined as income high enough to afford unsubsidized insurance. About two-thirds of this group was childless adults who only needed insurance for themselves.

Another six million of the uninsured earned between 200 percent and 300 percent of the federal poverty level. While that’s not officially considered enough to afford health insurance, it is often enough to pay for health care itself, except under the worst circumstances.

University of Michigan economist Mark Perry summarizes it this way:

Bottom Line: If you can afford a cell phone or cable TV, you can afford basic health insurance. In Michigan, you can get basic health insurance through Blue Cross Blue Shield starting at $47.14 per month for those 18-30 years old (about the cost of a basic cell phone plan), and starting at $168.13 per month for another plan for individuals under 65 and families (not too much more than a cable TV plan with premium channels, and about the same as two cells phones at the monthly average of $77).

I’m sure there are many cases where insurance would be much higher than those quotes. But the point is that, as this debate goes along, the focus should be on the areas that need reform, not the drama of anecdotes and not on statistics that sound dramatic but don’t tell the whole story.

By the way, one final group that’s included in the 47 million is non-US citizens. They’re people, of course. They just aren’t US citizens. The Census Bureau estimates they count for about 20% of the 47 million.

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