2012 Poverty Data: New Data from the U.S. Census on Poverty, Income, and Health Insurance.

Earlier today, the U.S. Census Bureau released the 2012 data on income, poverty, and health insurance coverage. For the second consecutive year, neither the official poverty rate nor the number of people in poverty at the national level were statistically different from the previous year’s estimates—the poverty rate remained at 15 percent – amounting to 46.5 million people living in poverty. While there was not an increase in the poverty rate, the 2012 data still indicated significant racial disparities in both poverty and income. The poverty rates among non-Hispanic Whites and Asians were 9.7 percent and 11.7 percent respectively, while the poverty rates for Blacks and Hispanics were 27.2 percent and 25.6 percent respectively.

Poverty and Income Data Highlights

• The percent of people in deep poverty, with incomes below 50% of the poverty threshold, remained at 6.6 percent from 2011, which is still a substantial increase from the 5.2 percent rate seen in 2006 and 2007 (prior to the recession) and even from the data collected in 1967 where deep poverty was at 4.4 percent.
• The poverty rates for children, those under the age of 18, was 21.8 percent, not statistically different from 2011.
• Median household income in 2012 was $51,017, not statistically different from the 2011 median income of $51,100.

Health Insurance Data Highlights

• The percentage of people without health insurance coverage decreased to 15.4 percent from 15.7 percent between 2011 and 2012, while the number of uninsured people in 2012 was not statistically different from 2011, at 48 million people.
• The percentage and number of people covered by government health insurance increased to 32.6 percent and 101.5 million people in 2012 up slightly from 32.2 percent and 99.5 million people in 2011.
• The percentage of Asians and Hispanics without health insurance decreased from 16.8 percent and 30.1 percent to 15.1 percent and 29.1 percent respectively.
• The percentage of uninsured children decreased from 9.4 percent to 8.9 percent in 2012.

Safety Net Programs

• Unemployment insurance was able to raise 1.7 million people out of poverty in 2012.
• Social Security income helped 15.3 million people aged 65 and older out of poverty in 2012 – if these payments were excluded - it would quadruple the number of elderly people living in poverty.
• The Supplemental Nutrition Assistance Program (SNAP), while not included in the poverty calculations used for the data today, if considered, would have reduced the number of people in poverty by 4 million people in 2012.
• The Earned Income Tax Credit (EITC) also reduced the number of children classified as living in poverty in 2012 by 2.9 million children.

The Important Role of Public Policy. Public policy helps create pipelines of educational opportunity and new jobs. It also creates the supports and services that help poor individuals and families while they work toward those opportunities. As evident in the data, the most noticeable statistic changes that occurred in 2012 were in health insurance coverage – with the number of uninsured children dropping from 9.4 percent to 8.9 percent in 2012.  This demonstrates the critical value of policies that make a public investment in children and families. Public investments have proven to have a real impact on reducing poverty – and subsequently improving the quality of life for millions of children and families. Unfortunately, the $85 billion in cuts to supports and services as a result of sequestration are likely to only exacerbate the conditions of poverty and increase the percentage of those living in unacceptable conditions – unable to meet their basic needs.

The Need for a Focus on Equity. The racial disparities in the poverty data indicate that Black and Hispanic families have continued to have disproportionately higher poverty rates and lower incomes compared to White families, which has been consistent for more than three decades. This inequity shows the need for innovative solutions and public investments aimed at supporting real change.  Policy strategies should take into account the existence of disparate opportunities and outcomes—attention to equity creates solutions that best meet the needs of the entire community.

To read CSSP's Statement on the New Poverty Data and Implications for Children and Families please click here.

For more strategies to Ensure Children Grow Up in Safe, Supportive and Economically Successful Families visit PolicyforResults.org.

More from our blog: a primer on poverty measurement and the Census instruments used.

Extending Medicaid to 26 – A New Policy Brief!

The Center for the Study of Social Policy has released a new policy brief, The Affordable Care Act and Implications for Former Foster Youth, addressing the Medicaid regulations extending coverage until youth turn 26.

As highlighted in the brief, 41% of foster youth between the ages of 18-26 do not have health insurance, while these foster youth are almost more than twice as likely to struggle with mental health problems and have significantly higher rates of health needs in general. Despite the understandable need for easier access to healthcare, foster youth have fewer options in comparison to their peers. Medicaid is essential in providing the necessary care and insurance to foster youth as they transition into adulthood.

To better address the needs of children in foster care, provisions in the Affordable Care Act, and the corresponding regulations, extend Medicaid to former foster youth until age 26. To qualify for the extension of Medicaid, the youth must have been in foster care at the time of their 18^th birthday, or have aged out of foster care based on their states’ age limits, and have been enrolled in Medicaid. These current Medicaid regulations require foster youth living within the state to receive eligibility for extended coverage.  However, coverage is important no matter where a young person grows up – so while it is only an option to provide coverage to youth who move from another state – it serves as an important support to these youth. 

The brief provides recommendations to states to maximize the health of children formerly in their care, including:

1. Elect the option to provide Medicaid coverage to former foster youth in different states.
2. Create an automatic enrollment process for youth prior to aging out of care.
3.  Implement a one-time Medicaid eligibility determination until the age of 26.
4.  Engage former foster youth and child welfare workers in designing an outreach campaign to identify successful outreach strategies in hopes of increasing the number of youth who enroll under this provision.
5. Select the most appropriate managed care program, instead of automatic enrollment for state-selected plans, for foster youth when possible.
6. Educate all child welfare agency representatives about the process of enrollment and to implement integrated care models, such as Health Homes.
7. Work with Medicaid agencies to coordinate enrollment eligibility of former foster youth even after the age of 26.

Medicaid provides a concrete support for young people transitioning into adulthood. To learn more about concrete supports that help youth to thrive, please read CSSP’s brief on Concrete Supports in Times of Need. For more results-focused policy strategies for children, youth and their families visit PolicyforResults.

Facilitating the Enrollment of Newly Eligible Families into the Exchanges

Beginning on October 1, 2013, individuals and small businesses will be able to purchase private health insurance through state-based competitive marketplaces called Affordable Insurance Exchanges (Exchanges), also known as the Health Insurance Marketplaces. Between the expansion of Medicaid and the subsidies that will become available to assist low-income families to purchase other types of insurance, these Exchanges are estimated to expand insurance coverage by the tens of millions. Health insurance is important for multiple reasons – and dramatically impacts outcomes for low-income families.  A study by the National Bureau of Economic Research found that having Medicaid corresponds with increases in hospital, outpatient, and drug utilization, increases in compliance with recommended preventive care, and declines in exposure to substantial out-of-pocket medical expenses and medical debts. There is also evidence of improvement in self-reported mental and physical health measures, perceived access to and quality of care, and overall wellbeing.

Affordable Insurance Exchanges will have a large impact on currently uninsured populations, especially young adults aged 18-34, who are the most likely to be uninsured. However, enrolling in health coverage is a significant obstacle for many Americans and their families. Many face challenges such as limited access to technology, low literacy skills, and language or cultural barriers. While the Affordable Care Act (ACA) simplifies the enrollment process and makes it much more consumer-friendly, many will need the assistance of trained and compassionate advisors in order to understand their coverage options and enroll in the most appropriate public program and/or health plan.

The Affordable Care Act (ACA) addressed the importance of in-person assistance by requiring all Exchanges to provide Navigator grants to entities for conducting public education activities to raise awareness about the new coverage options, helping people apply for, and enroll in, plans offered through the Exchanges, as well as providing referrals. It is the responsibility of Navigators to provide fair and impartial information to consumers about health insurance, the Exchange, Qualified Health Plans, and insurance affordability programs including premium tax credits, Medicaid and the Children’s Health Insurance Program (CHIP). Navigators will also provide referrals to consumer assistance programs and health insurance ombudsmen for enrollees with grievances, complaints, or questions about their health plan or coverage. Furthermore, Navigators are directed to provide information in a culturally and linguistically appropriate manner, including to persons with limited English proficiency; and to ensure accessibility and usability of Navigator tools and functions for persons with disabilities.

The U.S. Department of Health and Human Services submitted a related proposed rule for the Navigator Program on April 5^th and closed the comments period in May, with a final rule expected within the next few months. This proposed rule would establish conflict-of-interest and training standards, including standards for certification and recertification, for Navigators. States have the option of creating their own standards, as long as they meet the minimum requirements of the forthcoming final federal regulations.

As state policymakers design their Navigator Programs, important lessons from other consumer enrollment programs should be considered. According to an issue brief from the Georgetown Center for Children and Families, there are several components a Navigator Program should include in order to be responsive to people with low-income.

Target navigator resources to the most vulnerable. Research indicates that the lowest income and rural consumers prefer the kind of high-touch in-person services offered by community-based organizations while more moderate-income individuals may be comfortable with using a website or applying over the telephone with assistance from the Exchange’s call center. Given that resources are limited, it will be strategic to target navigator services through community-based groups that are best able to reach the most vulnerable, uninsured populations, focusing on those who are less likely to maneuver the eligibility and enrollment process on a self-service basis.

Integrate assistance for all insurance affordability programs. Two key factors drive the need for integrated navigator programs. First, many families will be covered through multiple programs (i.e. 75% of parents in the Exchange will have children in Medicaid or CHIP) and a significant number of people with fluctuating incomes will transition back and forth between Medicaid and the Exchange. Second, the ACA’s “no wrong door” approach requires that states provide access to all coverage options regardless of how and where consumers apply. Thus, consumers will best be served if navigators are highly trained and can provide assistance for all insurance affordability programs, while states will benefit from efficiency gains and economies of scale in consolidating navigator-type services.

Several enrollment strategies employed by Massachusetts were instrumental in the state’s success in reducing the uninsured population. Massachusetts’ enrollment gains under state health reform have been attributed to four key features of their implementation plan. These enrollment strategies help to explain why 97% of Massachusetts’ population is insured.

1. Massachusetts utilized data-driven eligibility and enrollment.
2. The state created a single, integrated eligibility system that offered information about various health coverage programs.
3. The state provided grants to community-based organizations for public education and enrollment support.
4. Massachusetts coordinated a strong public education campaign to inform consumers about coverage options and the individual mandate.

 In-person assistance will be critical to informing people that health coverage is available, to providing education about new coverage options, and to help with benefit utilization. Previous experiences with the creation of CHIP, and health insurance expansions in Oregon and Massachusetts show that an aggressive outreach and marketing campaign will achieve the result of markedly reducing the number of uninsured families - leading both to better health and economic security outcomes.

CSSP Resources for Health Reform Implementation

• Health Reform Implementation Opportunities for Place-Based Initiatives: Going Beyond Coverage to Improve Community Health - Issue Brief 1
• Health Reform Implementation Opportunities for Place-Based Initiatives: Consumer Protection and Patient's Bill of Rights - Issue Brief 2
• Health Reform Implementation Opportunities for Place-Based Initiatives: Community Roles in Assuring Coverage and Benefits - Issue Brief 3

For results-focused public policy strategies to ensure that children and families are healthy, visit Policyforresults.org. 

To Block Grant Medicaid—A Potentially Heavy Burden for States

Medicaid, the federal health insurance program that largely serves low-income children, seniors and certain disabled adults, has been a vital component of the public safety net since its inception in 1965. Because children under Medicaid tend to be in poorer health than children in private insurance (they have a higher prevalence of asthma, autism, dental and vision problems, ADHD, developmental delays, depression, and seizure disorders), Medicaid’s benefits package was designed to meet the complex needs of low-income children. Early and Periodic Screening, Diagnosis and Treatment (EPSDT) has been essential to ensuring that children continue to have a routine source of care and preventive screening for oral health, vision, mental health, developmental issues, and physical health.

In the last four years, people have enrolled into Medicaid at a higher rate than previous years as a direct result of the recession. With more people out of work, they lose access to their employer-based health insurance, their families become impoverished and they then become income-eligible for Medicaid. Furthermore, Medicaid’s enrollment has increased because of the aging population and because of the steady decrease in the number of employers who offer health plans to employees.

Since the federal government pays for the majority of the share of Medicaid spending, this increase in enrollment has led to an increase in the proportion of federal spending that goes to Medicaid. Although Medicaid costs less for the federal government than Medicare and Social Security, it often becomes the target of cuts because people with low-income are an easy target. Therefore, to control for the rising costs of Medicaid and to reduce the federal deficit, there are two very different opinions on the direction that Medicaid should now take: (A) expand Medicaid eligibility while creating cost-savings elsewhere or (B) block grant Medicaid.

Under the Affordable Care Act, Medicaid’s eligibility rules are set to expand in 2014 so that childless, non-disabled adults would be able to enroll if their income was up to 133% of the federal poverty level. The costs of this expansion are offset by revenues from the excise tax on high-premium insurance plans and net savings from other coverage-related effects, such that the Affordable Care Act produces a net reduction to the federal deficit of $124 billion.

On the opposite end of the spectrum is a proposal to change Medicaid from a defined entitlement program to a block grant. With a set amount of dollars and no mandates on coverage, states would have more autonomy and flexibility to design their Medicaid program to meet the specific needs of the state. Under this proposal, to encourage more enrollment into private insurance, premium supports or a refundable tax credit would help non-disabled adults and children to enter the private insurance market. States would be encouraged to use block grant dollars to pay for home-based care for the aged and disabled, rather than more costly institutional care.

As noted by First Focus in their analysis of the US House of Representative’s Budget Committee bill (which would block grant Medicaid), a Medicaid block grant would result in a loss of $810 billion over 10 years of federal investment in the program. About $162 billion of the total would come from investment in children’s services. While it would save money for the federal government, it would also shift the burden of costs to states, which would face a difficult decision in how to respond.

According to the non-partisan Congressional Budget Office, which also analyzed the bill, “states would face significant challenges in achieving sufficient cost savings through efficiencies to mitigate the loss of federal funding.” States could: (A) maintain current service levels, in which case they would need to reduce spending in other areas or raise revenues, or (B) reduce the size of their Medicaid program.

To adjust to the decrease in contribution from the federal government, states would likely have to tighten eligibility restrictions, ration care that children receive and lower payments to providers. Considering that Medicaid reimbursement rates are already lower than the reimbursement rates under Medicare and private insurance, this might discourage doctors from accepting Medicaid patients.

Whether Medicaid expands as an entitlement or is reduced via a block grant, states will have flexibility to design innovative programming to get services to their populations; it will be critical that state policymakers carefully consider their options (through state plans, waivers, demonstration programs, etc.) to provide quality, cost-effective care to children.For more on strategies to ensure that children are healthy, please visit PolicyForResults.org.

The Importance of Medicaid

Medicaid is crucial in supporting low-income households in obtaining healthcare coverage and provides health insurance to nearly 60 million children and families. Since Medicaid has strict rules for eligibility, the expansion of Medicaid benefits those who had not been previously eligible for any type of affordable health coverage. Under the current eligibility requirements, state Medicaid programs must cover children under the age of 6 living in families with incomes below 133% of the federal poverty level and children ages 6-18 with family incomes below 100% of the FPL. However, states can decide whether or not to extend eligibility further. For example, states must cover children up to 18 years of age, but have the option to cover 19 and 20 year olds. In addition, states must provide coverage to pregnant women with family incomes below 133% of the FPL and parents with incomes below 50% of the FPL, but have the option to provide coverage to these groups above the minimums.

Adults who are not disabled, pregnant, or elderly, and have no minor children generally have been excluded from Medicaid.  In the past, to extend Medicaid to these adults, states had to receive a waiver and could not receive additional federal Medicaid funds for this coverage; instead, states needed to redirect existing federal Medicaid funds or create program savings to offset the cost of the coverage.  As a result, the expansion of Medicaid will cover an additional 22.3 million uninsured individuals with incomes below 138% of the FPL.

Medicaid is jointly funded by the federal government and states. To finance the expansion, the federal government will cover 100% of the states’ cost in covering newly eligible Medicaid recipients, then phase down its federal contribution to 95% between  2014 and 2019, then again to 90% in 2020. Since April 2010, California, Connecticut, Minnesota, New Jersey, Washington, and the District of Columbia have expanded Medicaid to low-income adults and have been able to cover an additional 600,000 people.  These states were able to preserve, expand, and strengthen coverage for their low-income residents.

 According to The Urban Institute, if a state does not implement the expansion, some individuals would receive federal tax credits and other subsidies instead of Medicaid; however, cost-sharing requirements would be higher. Federal tax credits and subsidies would not be available for most people with incomes below the federal poverty line, which means uninsured individuals living above poverty can receive help, but those living below poverty would not. Rejecting federal funds and refraining from the expansion could have adverse impacts on more than 27 million uninsured Americans with incomes below 138 percent of the poverty level.

For state policymakers, it is important to consider the economic and societal benefits of providing healthcare to those who currently lack access to affordable coverage and to reduce coverage disparities.  

For state policy strategies to ensure that children are healthy, visit PolicyforResults.org. 

April is National Minority Health Month

The U.S. Department of Health and Human Services is commemorating National Minority Health Month by encouraging Town Halls and hosting events throughout the month to raise awareness of the disparities that exist in health care. While the average quality of health care has risen over the past few decades, disparities to health care access and quality of care have not improved. In a press release, HHS highlights how the Affordable Care Act (ACA) has already improved health disparities by providing coverage to previously uninsured minorities and eliminating co-pays or deductibles for some essential preventative services.

During last year’s Minority Health Month, HHS announced its first initiative solely focused on resolving disparities to health care access. The HHS Action Plan to Reduce Racial and Ethnic Health Disparities builds on the Affordable Care Act and other existing strategies, such as Healthy People 2020, to reduce health disparities among minorities. The report outlines where and why health disparities exist and carries five policy goals to remove those disparities: Transform Health Care; Strengthen the Nation’s Health and Human Services Infrastructure and Workforce; Advance the Health, Safety, and Well-Being of the American People; Advance Scientific Knowledge and Innovation; and Increase Efficiency, Transparency, and Accountability of HHS Programs. Under these five goals, HHS highlights specific actions useful to policy makers at every level of government. The report provides comprehensive strategies that policymakers can take to improve quality of care not only for minorities, but ultimately for everyone who needs health care.  

Following the message behind their Action Plan, the theme for this year’s Minority Health Month is “Health Equity Can’t Wait. Act Now in Your CommUnity” to emphasize the importance of community-based initiatives in improving access to and quality of health care.  For more information on events for this month, visit the HHS Office of Minority Health’s website.

The National Institute of Health is also celebrating the month through its first NIH Minority Health Promotion Day, sponsored by the National Institute of Minority Health and Health Disparities, on April 19^th. Various exhibits and speakers will present how social and economic factors contribute to and maintain health disparities in our health care system.

For state policymakers, Minority Health Month provides a great opportunity to raise awareness around the importance of quality health care access and a good time to promote efforts to improve that access in communities across the states.  For results based policy solutions to ensure that all children are healthy, visit PolicyforResults.org.