Besides the disappointing poverty data, the Census release included a very important piece of good news: the Affordable Care Act (ACA) is working really well. The percentage of residents in Connecticut without health insurance dropped from 9.4 to 6.9%. The decrease is statistically significant - close to 90,000 people that did not have insurance last year have it now.
For children the drop is smaller, and not statistically significant, although the starting point was already low: only 3.7% of Connecticut children remain uninsured, down from 4.3% in 2013. Full coverage is within grasp.
The ACA is not just having positive effects in our small, progressive state in the northeast. Nationwide, the uninsured rate has dropped from 14.5% to 11.7% in one year. The decrease will be even steeper with wider Medicaid adoption, but the trend is in the right direction.
As usual, CT Voices have a policy brief covering this issue as well. You can find it here.
Have you ever wondered why CAHS´Kids Count Data Book includes information on low birth weight babies? As you probably know, this is an indicator of the health of the mother during pregnancy, and has a strong effect on child development.
How strong? The New York Times published on Sunday a review of a new study linking birth weight and school achievement, and the results are striking. On average a 10 pound baby will score 80 points higher on the 1,600 point SAT than a 6 pound one. This is the difference between being quite a bit below the median (6-pound babies score in the 43rd percentile) or above it (10-pound babies score on average in the 57th).
Poor neonatal health, then, is crucial not just during pregnancy, but has long term cognitive effects. You can find the full study here.
This is a first in a series of posts that CAHS will be doing on the 2014 Annie E. Casey KIDS COUNT National Data Book release. Below is our press release that summarizes the reports findings regarding CT’s kids. Stay tuned for updates – including a recap of today’s release event at the Legislative Office Building (find more information and RSVP here) and posts that take a deeper dive into the 16 indicators that give us insight to the health, education, economic-well being and family and community context of our states’s children. The full report is available now here.
Child Poverty in Connecticut Has Increased Since 1990 despite Education Gains, New National Publication Reports
Number of children living in poverty has increased by 50 percent in the past 25 years according to the Annie E. Casey Foundation’s 2014 KIDS COUNT Data Book
Hartford – The number of children living in poverty in Connecticut has increased by 50 percent since 1990, according to a new report released by the Annie E. Casey Foundation. Nationwide, child poverty numbers are up since the recent recession, with nearly 16.4 million children in families below the federal poverty level. The good news is that both nationally and in Connecticut there have been steady improvements over the past 25 years in the numbers of children attending preschool and a decline in the number of students not proficient in reading and math.
Connecticut is ranked 7th overall on the report’s child well-being indicators that span education, health, economic well-being, and family and community context. The state ranked as high as 3rd in the pre-recession 2006 and 2007 years. The KIDS COUNT Data Book evaluates the latest data on children and families for every state, the District of Columbia, and the nation.
Comparing data collected in 1990, the first year the KIDS COUNT Data Book was released, to the most recent available data, the 25th edition of the national KIDS COUNT Data Book reveals that in Connecticut:
- Housing costs are a burden to children and their families. Over 40 percent of children in Connecticut are living in families that spend 30 percent or more of their income on housing. This places Connecticut near the bottom of all states (43rd).
- More children are living in high poverty neighborhoods. The percentage of children living in neighborhoods with high concentrations of poverty has nearly doubled since 1990. There has also been a significant increase in the number of children living in single parent families. In 1990, it was 1 in 5 children; in 2014 the report finds that it is now 1 in 3 children.
- Children are progressing in the areas of education and health. Connecticut’s children have improved significantly in education since 1990 – graduation rates and test scores have seen double digit percentage increases, and the state ranks 1st in the nation on the number of children who report a preschool experience. Connecticut also has a comparatively low-rate of uninsured children, and the lowest child and teen death rate in the country.
“This newest report shows us that Connecticut, one of the wealthiest states in the country, is falling behind,” said Jim Horan, Executive Director of the Connecticut Association for Human Services (CAHS). “The report also shows that a strong commitment paired with investment can bring about results. In recent years the Governor and the legislature have prioritized universal preschool access, and this year we were ranked number one in children reporting preschool experiences.”
Horan added, “We need to show this same commitment to our state’s poorest families in other areas – we need to allocate our time and resources to proven workforce training and support programs, greater affordable housing options, and outreach to our most vulnerable neighborhoods.
As the KIDS COUNT Data Book is being released in Baltimore, CAHS will be holding a conversation about the findings of the report, and next steps for the state, at a July 22 event at the State’s Legislative Office Building, Room 1C. The event will begin at 11:00 a.m.
The 2014 National KIDS COUNT Data Book is available in the KIDS COUNT Data Center, which also contains the most recent national, state and local data on hundreds of measures of child well-being. Data Center users can create rankings, maps and graphs for use in publications and on websites, and view real-time information on mobile devices.
The Connecticut Association for Human Services (CAHS) is a nonprofit policy and program organization that promotes family economic security strategies to empower low-income working families to achieve financial independence. Our mission is to end poverty and engage, equip, and empower all families in Connecticut to build a secure future.
The Annie E. Casey Foundation creates a brighter future for the nation’s children by developing solutions to strengthen families, build paths to economic opportunity and transform struggling communities into safer and healthier places to live, work and grow. For more information, visit www.aecf.org. KIDS COUNT® is a registered trademark of the Annie E. Casey Foundation.
CAHS hosted today an introductory webinar to explain how the Affordable Care Act ("Obamacare") is being implemented in Connecticut. Deb Polun, from the Community Health Center Association of Connecticut, and Kate Gervais, from Access Health CT, were the main presenters, going over the legislation and how Connecticut residents can access to the new benefits.
You can download the full presentation here (WMV, 133 MB - there is a bit of a pause in the middle - wrongly muted microphones). Here is Deb's presentation on the basic structure of the Affordable Care Act (PowerPoint); here is Kate's slides on how the new law is being rolled out in Connecticut, and how people can apply for benefits or get help if they need assistance with the process (PowerPoint).
Most political reporting is focused on the comings and goings in Washington, but the truth is that a lot of the most important policy decisions are taken at the state level. Take Medicaid: the Federal government funds the program, but state legislatures decide eligibility levels. The safety net might be paid mostly with Federal dollars, but it is the people in Hartford, Austin, Albany, Madison or Montgomery that decide who has access to it.
Paul Waldman, at the American Prospect, illustrates this reality:
The numbers above are the income limit to apply for Medicaid for a family of three. Connecticut's are more than ten times higher than Arkansas. At least in Little Rock this will change soon, as the state has signed up for the Medicaid expansion under the Affordable Care Act (starting January 1, the income limit there will be the same as in Massachusetts). Many of the stingiest states, however, are not participating, so in some corners of the country families will have well below the poverty line to qualify for health insurance.
That's one of the reason why CAHS does so much policy work at the state level, and that's why what we do in Connecticut matters. It is the state who decides how generous our safety net will be, not just Washington.
We work every day to make Connecticut a better place. Our policy work has helped improve the safety net on our state in many ways, from the state EITC to Care for Kids. If you believe that our work is important, please donate.
The Affordable Care Act (ACA) starts the final phase of its roll out tomorrow Tuesday. It is the largest expansion of the U.S. safety net in more than 40 years. It really is a big, big deal. It is also, despite all the noise, a fairly simple, elegant piece of legislation, based on some pretty simple ideas. The original blueprint behind the ACA framework comes from a Heritage Foundation policy paper (I am not joking) that you can read here. The law is a refinement of this model, with a few minor additions.
To explain the ACA, we have to begin with a simple question:
Why health insurance companies did not cover preexisting conditions?
The two main issue with health care coverage pre-ACA was simple: first, health care coverage was expensive. Second, health insurance companies did not cover patients with preexisting conditions.
Both issues seem to be unrelated, but they are not. Insurance companies basically work by pooling risk: they have X amount of clients paying premiums that barely need health care, and a tiny percentage of clients that need a lot of it. The premiums of the healthy are used to cover the bills of the sick. We sign up for insurance mostly because we really don´t know if we are going to be sick or not; we pay a little now just to lower the risk of being hit with huge bills later.
Patients with preexisting conditions, however, are different: for an insurer point of view, they are people that have a much higher risk of needing health care. That is, they are always more expensive to cover, so insurance companies try to avoid them. They want their risk pool to be balanced, with a small percentage of sick people and a big group of healthy-premium payers to cover their bills. If you are unlucky and had an accident, illness or chronic condition around, tough luck.
A health care system that excludes former cancer patients, people with HIV or diabetes, however, is obviously unfair. It is no one´s fault to get ill; the government should not allow this to happen. Let´s say that legislators reacted and decided to ban insurance companies from denying insurance to patients with preexisting conditions, trying to right this wrong. This is one of the founding stones of the ACA, and one of the most important features of the law. What would happen?
For starters, no one will get health insurance. If you are healthy and you know that you can sign up for a plan the moment you get sick, why should you pay monthly premiums? Everyone will wait until they get sick before signing up for coverage, leaving the insurers with a risk pool full of sick people. Only people that really need insurance will get it, so the premiums will skyrocket. An insurance dead spiral that will leave everyone without coverage.
To prevent that from happening, the ACA uses a pretty simple, straightforward solution: the individual mandate.
The individual mandate
In a world with preexisting condition coverage, every one has a very strong incentive to free ride: remain insurance free, and hope someone else is paying the bills. The individual mandate strives to avoid that: to make sure that no one is shirking his responsibility by not paying into the system until they get sick, the government mandates everyone to get insurance, or pay a penalty.
Although the individual mandate is the most unpopular piece of the ACA it is by far its most important component, as it enables the rest of the law to work. If everyone must have insurance coverage, no matter their health, the risk pool will have a good mix of sick and healthy individuals, making risk sharing through insurance possible. The penalty works like a tax on free riding: for those that don´t feel like participating in the system, they at least have to cover the risk of them falling ill and applying for insurance when they need it.
The individual mandate also plays a role in enabling the ACA to use community rating: insurers can not charge higher premium to women, and have limits on how much extra they can charge by age. Insurers prefer to attract young people to their rolls, as they get ill less often. The individual mandate essentially forces the young and healthy to the risk pool, enabling the ACA to keep premiums for seniors lower.
We are mandating coverage, then, to make sure that people that are too old or too sick to get health coverage have access at the same price as the rest of the population. What we haven´t yet resolved, however, is access to those that are simply too poor to afford insurance, and can not pay for coverage, even with these regulations in place.
Fortunately, the ACA has a solution for this issue: subsidies.
Medicaid expansion and tax credits
The ACA mandates the purchase of health insurance coverage. Its designers, fortunately, understood that not everyone can pay for it right away, so the legislation includes an extensive system of subsidies and supports for those that need them.
First, Medicaid eligibility is greatly expanded: anyone under 138% of the Federal Poverty Line will be eligible for the program in the states that choose to embrace the expansion. In practice this means than liberal-leaning states like Connecticut will be able to enroll tens of thousands of people in health insurance, with the costs being covered by the Federal government.
For those above the threshold, the ACA includes additional support in the form of tax credits to purchase private insurance. Any family or individual between 138 and 400% of the Federal Poverty Line (note that 400% FPL is above the median income in the US, so this subsidies do cover a lot of people) will be able to claim these subsidies, calculated on a sliding scale.This means that for many working families purchasing insurance in the open market the ACA will cover most of the premiums, making coverage affordable.
The structure of the law is, in fact, remarkably simple: we want to cover preexisting conditions, so we need an individual mandate. If we force everyone to have insurance, we need to help low income families comply by subsidizing it. This is the ACA in a nutshell.
Odds and ends: exchanges, employee mandate, small business credits
Some final details worth pointing out. All of the above is only immediately relevant for the currently uninsured or for those getting health insurance in the private market, and not through their employer. The health insurance exchanges / market places like Access Health CT focus on those groups. The exchange is essentially a central hub for people that are not covered by their employers to compare private insurance plans and get their tax credits automatically.
The ACA has two additional features for the the employer-based system: first, large business are mandated to provide health insurance to their full time workers, or they will have to pay a penalty. Second, small businesses that offer health coverage will get a tax credit. The employer mandate as it stands in the law is notoriously clumsy, and it has been delayed for a year. Small businesses will also be able to purchase insurance through a dedicated exchange/market place, but its roll out has been delayed until November.
All in all, The exchanges get rolling tomorrow; the tax credits, individual mandate, tax credits and Medicaid expansion kick in January 1st. It is a good law: simple, elegant and conservative in the best way possible, not trying to fix what is not broken. The country will be better off with it. Tomorrow is a big day.
Way back in 2009, when the CBO was estimating how much people were going to pay for health insurance in the soon-to-be-created exchanges, they gave a pretty startling number: $433 a month per person, on average, for a silver plan.
A lot of studies looked similar, and critics started talking about "sticker shock" once the law was implemented. The Affordable Care Act would be forcing people to get expensive insurance that they can not pay, and so on.
Well, we are starting to see the exchanges come to life, and it turns out that the premiums are coming much lower than everyone expected. California just published the list of plans and premiums from their (gigantic) exchange, and the cheapest silver plan for a 40 year old male costs $276 a month, or a 63% of the expected cost. This premiums would be for unsubsidized plans; for individuals below 400% the Federal Poverty line, the costs would be actually much lower (in grey, the subsidy amount):
¿Surprising? Well, sometimes it turns out that legislation does work as intended; a big pool of potential clients, plus standardized, comparable plans, plus plenty of competition between insurance companies translates into pretty affordable prices. Admittedly California is a huge market with more than seven million uninsured and their exchange have pretty detailed cost-control regulations, but the basic structure of Obamacare is sound, so it is not surprising that it might just deliver.
The most important bit of this prices, by the way, are not the premiums for forty-somethings; the success of the law lies in convincing low risk, young patients to enroll instead of paying the penalty. The premiums on that end are pretty affordable, all things considered. Here we have the cheapest bronze (less generous) plans:
Again, not too bad, and the subsidies make a huge difference. This legislation might just work as promised. And that´s very good news. The rates so far in Connecticut don´t look terrible, but we haven´t seen the insurance carriers competing yet. We´ll see.
Conservatives have been asserting this past week that having health insurance is really not that important. Mitt Romney has mentioned in a couple of interviews than people do not die because have health insurance; if someone gets ill, they always can get taken care off in the emergency room.
There is a small problem with this statement: it is completely wrong. Take, for example, this recent study from a team of researchers at John Hopkins comparing mortality rates after having a heart attack or stroke: the uninsured had a risk of death 31% higher than those with private coverage after the heart attack.
Both patients, insured and uninsured, went to the hospital and were treated. As Sarah Kliff points out, however, the uninsured were much more likely to have skkiped out on preventive care, meaning that their health was much worse before the stroke / heart attack, and they were not able to afford the follow up treatment after:
In this analysis, insurance status is likely a proxy for access to care and subsequent poor or incomplete management of cardiovascular risk factors among those with CVD. The phenomena associated with being underinsured, including insurance instability, problems with clinics accepting payments, and inability to afford medications, may be some of the factors that define this high-risk group and contribute to poor disease management.
This is only one study of several. Brian Beutler points at several others. A recent report published on the American Journal of Public Health estimates that lack of health insurance is associated with as many as 44,000 deaths per year in the United States, ore than those caused by kidney disease.
As a senior policymaker put it not long ago (video):
There ought to be enough money to help people get insurance because an insured individual has a better chance of having an excellent medical experience than the one who has not. An insured individual is more likely to go to a primary care physician or a clinic to get evaluated for their conditions and to get early treatment, to get pharmaceutical treatment, as opposed to showing up in the emergency room where the treatment is more expensive and less effective than if they got preventive and primary care.
That was Mitt Romney in April 2006, in a presentation before the Chamber of Commerce, by the way.
The New York Times had a very interesting article yesterday talking about something that looks fairly irrelevant: are health care benefits income?
In July, the Congressional Budget Office — the nonpartisan arbiter of the costs and consequences of government spending — decided that we had not been valuing these benefits enough. In a report on how income and taxes are distributedacross the population, it decided, for the first time, to value health benefits provided by the government at every penny they cost.
The decision stoked a long-simmering debate about how much health care is really worth to poor families who may not have enough to eat. The reclassification of health benefits added $4,600 a year to households in the bottom fifth of income. It shrank the nation’s yawning income gap and muted the increase of inequality over the last three decades. And it changed the picture of what the government does for Americans.
The article has a good discussion on this specific debate, and how it affects official poverty numbers in the US. For instance, many seniors and very low income families now considered poor would move out of these categories, while working families would actually move much closer to the bottom of the income scale.
I largely agree with the CBO with this new calculation – both from a statistical point of view and a political point of view.
For statistics, one very simple reason: that’s how it is usually counted elsewhere in the world. OECD numbers count health care as a fiscal transfer, and it makes sense for the CBO to do the same. After all, it is real money that the government is spending in a real good; if instead of SNAP we had government run soup kitchens it would still be seen as an almost-cash transfer, and this works the same way.
From a political point of view, this change makes clear that the government is very effective getting people out of deep poverty. It really is! There are many, many people in the US and elsewhere that would be much worse off if the Federal government was not around. Medicare has been extremely effective keeping seniors out of poverty, but the numbers barely reflect that.
The new calculation method also makes more clear a big issue with the US safety net and its over-reliance in means tested programs: the huge, crippling fiscal cliff that poor families face when their income starts to slowly creep up towards the middle class. We wrote about this with some detail a few weeks ago, but it is important to keep this in mind. The marginal tax rate of a family moving from 100-125% Federal Poverty Level (FPL) to 185-200% FPL is absurdly high if we take into account benefits loss. "Earning yourself out" of Medicaid / Husky is often a huge blow for a family that lacks health insurance and now has to pay full price for it.
Leaving that aside, the big problem, and something that the revised numbers make more clear, is that right now the US welfare system is pretty terrible moving people from not-so-terrible poverty to self sufficiency. But income mobility and pathways to success deserve their own blog post.
Medicaid has the rare distinction of being one of the most misunderstood Federal programs of the American safety net system. Usually depicted as a program focused on providing health insurance to low income families, the vast majority of Medicaid spending is used to cover two specific groups: seniors and the disabled.
|DISTRIBUTION OF MEDICAID PAYMENTS BY ENROLLMENT GROUP, FY2009VIEW 50-STATE COMPARISON|
Most Medicaid spending for seniors goes to cover long term nursing care (41%) and home and personal care (45%), very expensive services that they otherwise won´t be able to afford. Long term disability coverage, meanwhile, is a corner of the health insurance market that private insurers have largely left alone, as premiums would be prohibitive.
Interestingly enough, even if most tax dollars go to cover these patients, the vast majority of Medicaid and S-CHIP participants are children and their parents:
|DISTRIBUTION OF MEDICAID ENROLLEES BY ENROLLMENT GROUP, FY2009VIEW 50-STATE COMPARISON|
Why does most of the spending go to seniors and the disabled? Simple: costs for those groups are much higher. As usual, most medical spending goes to a tiny sliver of the population, as costs usually are concentrated on those that are really sick.
|MEDICAID PAYMENTS PER ENROLLEE, FY2009VIEW 50-STATE COMPARISON|
When political candidates talk about block granting Medicaid, consequently, they are not proposing to cut benefits to low income adults that don´t have insurance. Most program participants are children, not adults - and the bulk of the spending goes to two population groups that are extremely vulnerable, seniors and the disabled. Cuts in Medicaid are much more damaging for the elderly than any proposed cut to Medicare spending any candidate has put on the table.
And by the way, Obama and Ryan have largely similar Medicare cuts in mind.