Expert Commentary

Demand for health insurance among uninsured Americans

2012 study from Princeton University on the number of uninsured Americans who might participate in reform efforts.

The 2010 U.S. Patient Protection and Affordable Care Act mandates that citizens obtain health insurance and aims to use state-run health care exchanges to allow the uninsured to purchase more affordable private health care. Prior research on the uninsured has focused on how to increase participation in the traditional employer-based health care system, not on how the uninsured might respond to the opportunity to buy a plan independent of the workplace.

An April 2012 study from Princeton University for the National Bureau of Economic Research, “The Demand for Health Insurance among Uninsured Americans: Results of a Survey Experiment and Implications for Policy,” examined 2008 Gallup poll data that explored how uninsured citizens might take advantage of greater health care coverage opportunities. The scholars analyzed how respondents evaluated coverage at different price points and noted that “to the best of our knowledge, our dataset is the first to elicit self-reported willingness-to-pay for health insurance among a large sample of uninsured Americans.” The study also investigated how the Affordable Care Act’s mandate might expand coverage — and what might happen without a mandate. It assumes, per Congressional Budget Office projections, that there will be 51 million uninsured non-elderly citizens in 2014 without the mandate.

The study’s findings include:

  • Some 60% of the uninsured would likely buy comprehensive health insurance for an annual price of $2,000.
  • Given the health care subsidies under the Affordable Care Act, 75% of the currently uninsured adult population would likely enroll in a health care plan; this suggests that 39 million Americans would gain coverage.
  • Without the health care mandate, roughly 33 million citizens (28 million adults, 5 million children) might gain coverage by taking advantage of provisions in the Affordable Care Act: “Stripping the individual mandate from the law — the constitutionality of which is being challenged in federal court — would lead to between 7 and 12 million fewer individuals gaining coverage.”
  • The study also explores concerns that those in poorer health might be more willing to get low-cost insurance, burdening insurers: “We find no evidence that less healthy individuals would be more likely to enroll, with or without a mandate.”

The researchers stated that this more targeted inquiry is “key to formulating a policy” that could extend coverage to the uninsured population: “Not only are these individuals substantially poorer than the average worker offered employer insurance, but the decision to, say, purchase subsidized insurance from a state exchange might fundamentally differ from the decision to enroll in an employer-sponsored health plan, which takes place in the context of co-workers, an employer and potentially benefits counselors.”

Note: One of the paper’s co-authors, Alan B. Krueger, became chairman of the White House Council of Economic Advisers in late 2011.

Tags: health care reform, campaign issue, poverty