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New Studies Find Growth in Uninsured Outpacing Federal Spending on Health Safety Net

NOVEMBER 4, 2005 -- Federal spending on the uninsured has not kept pace with the growing number of Americans who have no health care insurance, according to a report released Friday.

As the number of uninsured Americans increased by 4.6 million from 2001 to 2004, net federal spending per uninsured person fell $546, to $498, during the same period, according to the findings from the Kaiser Commission on Medicaid and the Uninsured. After adjusting for inflation, total federal spending for care for the uninsured increased by 1.3 percent from 2001 to 2004 while the number of uninsured increased by 11.2 percent, resulting in an 8.9 percent decline in federal spending per uninsured person.

The commission released five reports Friday that profile the growing uninsured population and portray the health care safety net as increasingly strained to the meet the needs of the uninsured.

"In the absence of providing health insurance coverage for our nation's growing uninsured population, some have said that the uninsured can receive care when they need it through the nation's health care safety net," Diane Rowland, the commission's executive director, said in a news release. "The new studies and personal stories released today document the increasing burden health providers are facing in delivering needed care."

One of the studies released Friday found that while federal funding for community health centers increased by more than 50 percent over the past four years, the money accounts for less than 3 percent of total federal spending on the health care safety net. The study, prepared by Jack Hadley and colleagues at The Urban Institute, also noted that since more than 70 percent of federal support for the uninsured comes from Medicare and Medicaid—which are both facing budgetary pressures—it is unlikely those programs will be able to provide more funding for the uninsured.

Other findings from the Commission studies include:

  • All of the 6 million increase in the number of the uninsured from 2000–04 was among adults and two-thirds of the increase was among people with incomes below 200 percent of the poverty level, which is about $39,000 for a family of four in 2004.
  • Half of the growth in the uninsured was among young adults (ages 19–34) who experienced sharp declines in employer coverage rates. Fifty-four percent of the growth occurred in the southern region of the country, which experienced the greatest growth in both the general population and low-income population combined with the largest decrease in employer coverage. This contributed to the 3.2 million increase in uninsured people in the South alone.
  • Immigrants are disproportionately more likely to be uninsured because they often work in low-wage jobs that are less likely to offer health coverage, and immigrants face restrictions on their eligibility for coverage in public health insurance programs. But immigrants have not driven the recent growth in the uninsured. Between 2000 and 2003, when the economy slowed, native citizens made up 3.6 million of the 5.1 million more uninsured.

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