New York Makes Real Progress on Health Care Coverage

September 27, 2006. This issue of Fiscal Policy Note$ presents data showing that the portion of the state population without health insurance has fallen from 16.3% in 2000 to 13.5% in 2005. Nevertheless, there are still 2.6 million people in the state who have no health insurance. The share of private sector employees covered by health insurance continued to fall while the portion of the population covered by government programs in New York rose from 27% to 31%. Press release below.

Two national reports were also released on health care issues today:

New York Makes Real Progress on Health Care Coverage
Significant Decrease in the Number of Uninsured, but Fiscal and Economic Burdens Must Be Addressed

New reports by the Fiscal Policy Institute and the Economic Policy institute have revealed important changes in health insurance coverage since 2000.

According to Fiscal Policy Institute’s report, New York was the only state in the U.S. to make significant inroads in reducing the portion of its population without health insurance. This is in stark contrast to a national trend toward a larger share of the population without coverage, as reported in the Economic Policy Institute report.

Nationally, the number of people without health insurance coverage increased by 1.7 percentage points over a five-year period, reaching 15.9% in 2005. The EPI report also shows a significant drop in employer-provided coverage.

In New York, however, a parallel analysis by the Albany- and New York City-based Fiscal Policy Institute shows that the overall rate of uninsured New Yorkers decreased by 2.8 percentage points over the same five years, to 13.5% in 2005.

The improvements in New York were due to two kinds of government action.

First, employer-provided coverage, which dropped in the U.S. as a whole, remained stable in New York. Employer-provided coverage in New York declined among private sector employees between 2000 and 2005 by 2.5 percentage points, so that in 2005 just 52.5% of people working in the private sector had employer-provided coverage. But these private-sector losses were offset by an increase of 3.8 percentage points in the portion of public employees who receive health care benefits with their jobs, bringing that figure to 78.8%. Thus, the overall rate of employer-provided health care – for public and private sector employees and dependents combined – remained at 60.2%.

Second, with employer-provided coverage remaining stable in New York, what allowed overall health care coverage to increase was the portion of the population covered by government-sponsored health care programs. Between 2000 and 2005, the portion of the population covered by government programs went from 27.0% to 30.8%.

“Today, just about the same number of people in New York State get their health insurance through government as through the private sector,” said James Parrott, chief economist for Fiscal Policy Institute. “That’s a remarkable development.”

As the cost of health insurance premiums skyrocket – increasing by 73% from 2000 to 2005 – there is increasing pressure on our health-care system.

“What’s happening in New York,” according to Fiscal Policy executive director Frank Mauro, “is that the government is stepping in where the market is failing. State programs such as Child Health Plus (introduced in 1991) and Family Health Plus (introduced in 2000) have been literal life-savers, allowing a broader spectrum of the population to qualify for government-provided health care.”

“Yet, this solution is far from ideal,” Mauro stressed. “Some private-sector employers wind up with an unequal burden, while others ride on the back of public insurance. What’s clearly needed is a comprehensive solution that increases health care coverage while reducing health care costs.”

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