Commentary

“Cover the Uninsured Week” — With Honesty

Last week’s national “Cover the Uninsured Week” should have kicked off with a little honesty. The campaign is a coalition of over 100 groups that inundated Americans with advertisements, events, and pleas from former presidents and celebrity spokesmen “to publicize the problem of allowing nearly 44 million Americans to live without health care coverage, and to highlight proposed solutions.” The first problem the coalition should have addressed is how it is misleading the public.

As far back as the Clinton administration, some critics have tried to create a sense of urgency behind expanding government health programs by citing a government statistic that said something like 40 million Americans lack health insurance.

Originally, “40-something-million-uninsured” meant the persistently uninsured, i.e., those who lacked health insurance for the entire year. The Congressional Budget Office shot holes in that statistic last May when it reported the correct figure is between 21 million and 31 million. Difficult as it may be to believe, an official government statistic was off the mark by maybe 110 percent.

The CBO’s figures may still be too high because they count millions of Americans who are Medicaid-eligible, and therefore have coverage whenever they need it. One-third of all “uninsured” children (2.9 million) fall into this category (the CBO gives no estimate for adults). Moreover, the persistently uninsured are mostly young (39 percent are under age 25, and another 22 percent are under age 35) or healthy (86 percent report their health to be “good,” “very good,” or “excellent”).

Rather than admit they have been overstating the number of uninsured by a factor of two and make an embarrassing retraction, which might tend to deflate the campaign, Cover the Uninsured Week continues to claim there are 44 million uninsured. The only possible way to explain this is that they take refuge in the CBO’s finding that the original, faulty government statistic does happen to be roughly equivalent to the number of Americans who lack insurance at any specific point in time, rather than for the entire year.

But this broader measure just adds to the count even more not-so-hard cases. In addition to those eligible for Medicaid, for instance, it includes people who lose their health insurance for only a brief period, such as when they graduate from college or change jobs. Over 3 million such people will regain coverage within four months, and another 6 million will regain coverage within 12 months. Various studies suggest that one-fourth (10 million) of this group decline coverage that is offered by their employers, and one-fifth (8 million) live in households making more than $50,000 per year.

The danger in overstating the number of uninsured is that we might do something foolhardy, like force taxpayers to provide them with coverage. That’s what Sen. John Kerry would do if president, and it’s what Congress tried to do for children in 1997 through an effort that essentially expanded Medicaid. The result? A study by the National Bureau of Economic Research found scant evidence that Medicaid improves the health of low-income children. However, another NBER study found that the expansion eroded the private health insurance market. Between one-fifth and one-half of the new enrollees were children who already had private coverage. When they enrolled in Medicaid, they became subject to the sort of government rationing that Oregon’s Medicaid bureaucracy lamented when it wrote in 2001, “having coverage does not always guarantee access” to medical care.

Not every Cover the Uninsured Week sponsor supports expanding government programs. But once they commit to covering all the uninsured, there is no way to reach that goal short of compulsory health coverage. Whether it is administered by government or the private sector, compulsory health coverage means government-run health care. The campaign’s official glossary even defines the underinsured as “people who have some type of health insurance, such as catastrophic care, but not enough insurance to cover all their health care costs.” It’s clear that Cover the Uninsured Week will drag on until all health care costs are socialized and individual responsibility is nil.

A better goal would be to restore to America’s largely socialized health care system the market processes where producers compete to provide consumers with value, and consumers keep costs down by patronizing efficient producers and avoiding inefficient producers. That patient-centered process has begun with the introduction this year of health savings accounts, and it will do more to provide quality, affordable health care to the masses than a century of Cover the Uninsured Weeks.

Michael F. Cannon is director of health policy studies at the Cato Institute.