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Health Insurance is a Family Matter BOX 7.1 Conclusions The whole family can be affected by any member’s lack of insurance. If anyone in the family is uninsured, the financial and emotional well-being of the entire unit is at risk, as well as the health of those who are uninsured. Employment-based and public insurance programs leave gaps in coverage for many families. The families in which some or all members lack insurance disproportionately include those with lower income, a single parent, and racial and ethnic minorities. Purchasing health insurance for uninsured family members is not practical for most of these families because of their limited incomes and lack of assets. Uninsured families are less likely to use any medical services than are insured families and those who do, use fewer services on average. When uninsured families are affected by illness or injury, they are also more likely to have high health expenses relative to income. Transitions over the course of a family’s life related to aging, employment, and marital status, such as job changes, divorce, retirement, or death of the insured member, may disrupt health coverage. Many of the transitions are unavoidable or unpredictable and result in loss of coverage. Parents’ insurance status is an important determinant of their children’s insurance and health care. Federal programs have expanded coverage to children, but insuring children may not be enough. Insuring parents is an important part of the process of bringing health care to children. Uninsured parents are more likely to suffer poor mental and physical health than are insured parents and their health can play an important role in their children’s well-being. Uninsured women and their newborns receive, on average, less prenatal care and fewer expensive perinatal services. Uninsured women are more likely to have poor outcomes during pregnancy and delivery than are insured women. Evidence of improvements in outcomes for newborns based on measures of overall population insurance coverage is mixed. Children with insurance have better access to and use more health care services than uninsured children. The parents of insured children are also less likely to delay seeking care for their children for conditions that require it, and illnesses or conditions are not as severe when they do seek care. Uninsured children are less likely to receive important preventive services that can have beneficial long-term effects.
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Health Insurance is a Family Matter 7 Conclusions The Committee’s overarching conclusion is that insurance coverage within a family concerns and may affect the entire family unit. The lack of insurance of any family member has the potential to affect the financial and emotional well-being of all members of the family. This suggests that we focus not only on the more than 38 million uninsured adults and children in the United States, but also on the 17 million families in which some or all members are uninsured.1 A FAMILY PERSPECTIVE Of the 85 million families in the United States, 17 million have one or more members who lack health insurance. Narrowing the focus to the roughly 38 million families with children, in 3.2 million of these families all members lack insurance and in an additional 4.3 million families some but not all members are uninsured (see Chapter 2, Table 2.1). Together these uninsured families with children account for about one-fifth of all families with children. Among married, childless couples, an additional 3.7 million family units have one or both members uninsured. More than 38 million uninsured people live in the 11.1 million family units mentioned above, with relatives other than their own children under age 18, with people other than conventionally recognized kin, or alone. Because of family relationships—financial responsibilities, psychosocial ties, and traditional child rearing obligations—an uninsured individual may affect the lives of other immediate family members, even if they have coverage. Thus, the consequences of not 1 The CPS estimates those who have been uninsured for the complete year.
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Health Insurance is a Family Matter having health insurance may intimately touch the lives of more than 58 million of the 276.5 million people in this country. FINANCIAL AND HEALTH CONSEQUENCES FOR FAMILIES Many of these 58 million feel the impact of living with uninsured family members as merely an insecurity or worry about the possibility of a very large health-related expense. Fortunately, very serious and expensive illnesses and accidents occur relatively rarely, although chronic and expensive conditions are more common. Uninsured families do have reason to worry. More than 15 percent of families with all members uninsured for the full year experience health expenditures that exceed 5 percent of their family income in a year compared with 9 percent of families in which all members are either privately insured or covered by Medicaid. Expenditures are also higher for families whose members are uninsured for the full year than for those who may have lacked coverage for a shorter period. Because families with at least one uninsured member tend to have lower incomes than do fully insured families, along with very few assets, they generally have fewer financial resources to help cope with these higher expenses. This may financially destabilize the entire family. The Committee recognizes, however, that high out-of-pocket medical bills can be damaging to families at almost any income level, whether or not they are insured. For uninsured families, what is more common than ruinous health costs is the likelihood that they will go without needed care. Although uninsured people tend to have poorer health status than otherwise comparable insured people, they are less likely to visit a physician, fill prescriptions, and obtain preventive care and other services. Chapter 6 of this report presents strong evidence that insured children have better access to and use more health care services than do uninsured children. Uninsured children are less likely to receive the routine medical attention that is considered necessary for quality preventive care than are insured children. Low-income, minority, non-citizen, or uninsured children consistently have worse access and use than do children without those characteristics. Uninsured adolescents are more likely than those with insurance to have no regular source of care, fewer visits, and unmet health needs. Similarly, uninsured children with special health care needs, whose medical conditions require significantly more than routine well-child care, also have less access to a usual source of care, are less likely to have seen a doctor in the past year, and are less able to get needed medical, dental, prescription, and other care compared to children with special health care needs who do have insurance. Many of the health and developmental implications of the reduced access to and use of services by uninsured children may not become apparent on a population-wide basis, at least not for many years, because most children tend to be healthy and have many fewer chronic conditions than their elders. Nonetheless, studies demonstrate that parents delay seeking care for their uninsured children
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Health Insurance is a Family Matter until the symptoms are more severe. These delays may result in unnecessary hospitalizations for conditions that could have been treated on an ambulatory basis and, in some cases, place uninsured children at a higher risk of premature death. If left untreated, some of the common childhood illnesses that can be detected and treated with routine care can also have long-term negative impacts on children’s development, including middle-ear infections, asthma, and iron deficiency. To the extent that timely and appropriate medical care might ameliorate or even prevent these conditions, insurance contributes to better future functioning and life chances for children. Further, provision of preventive care to children can have beneficial long-term effects that extend beyond health, so that society can reap the rewards in the future. The Committee recognizes, however, that there are many factors in addition to medical care that influence children’s health and development. IMPLICATIONS OF PARENTAL COVERAGE The Committee’s second report, Care Without Coverage: Too Little, Too Late, shows that the 30 million adults without coverage, many of whom are parents, are less likely to receive appropriate, timely care, particularly for chronic illnesses and certain life-threatening conditions, such as cancer, than are insured adults. Health policy researchers and health care professionals understand the financial and health risks of having family members without insurance. The public also appreciates these risks by showing a strong preference for insuring their families, when given a realistic and affordable option for family coverage. The Committee’s analyses in this report reveal another, more insidious and subtle consequence of uninsurance, namely that if a parent is uninsured, the children in the family may be less likely to get the medical care they need, even if the children have coverage. Because children depend upon their parents and guardians as decision makers as well as caregivers, parents’ experiences with the health care system and their beliefs about health care are important. Parents’ ability to negotiate that system on behalf of their children affects how children benefit from their insurance eligibility and coverage. In Chapter 5, the Committee shows that parents’ own use of health care, including whether they have a usual source of care and are connected to the health care system, are powerful predictors of their children’s use of services. Compared to insured adults, uninsured adults are more likely to have no doctor visit in the previous year, to use fewer medical services, and to have negative experiences when they finally obtain health care. The evidence suggests that children of uninsured parents may be less likely to get the full benefit of their own coverage than are children whose parents are also insured. Not only may parental coverage be an important determinant of children’s access to care, it also can affect the parents’ health. The mental and physical health of parents plays an important role in child well-being. Being in poor physical or mental health, which is more likely for those of low income and those without insurance, has a bearing on a parent’s child rearing practices and ability to cope
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Health Insurance is a Family Matter with the stresses of raising a family. The physical and emotional health and development of their children may suffer as a result of parents’ poor health. A key example of a parent’s health affecting that of the child can be seen during pregnancy. Providing public health insurance to previously uninsured pregnant women increases the use of prenatal care but not to the level seen with privately insured women. Uninsured women and their newborns receive less prenatal care and fewer expensive perinatal services than do insured women. Uninsured newborns are more likely to have adverse outcomes than are their insured counterparts. The evidence to date on whether expanding coverage improves an outcome such as low birthweight is not definitive, however. POPULATIONS AT RISK Families having some or all members with no insurance for extended periods are at greater risk of adverse consequences than are those with brief gaps in coverage. The Committee has shown that families with members uninsured for long periods are more likely to incur substantial health care costs for services and to suffer adverse consequences to health. These risks have added significance because of the types of families most likely to have some or all members uninsured. The families in which some or all members lack insurance disproportionately are low income, single parent, immigrant, and racial and ethnic minorities. They face multiple barriers to care—of culture, education, and language—in addition to lack of financial means. The percentage of families with children in which no members are insured increases as family income declines. Also, minority population families are more likely to be wholly uninsured or have some members without coverage than are other families. The uninsured rate for immigrants and naturalized citizens has been significantly higher than that of U.S.-born residents. In addition, there are families more likely to suffer negative consequences of having uninsured members, even though they are relatively more likely to have insurance than are the populations above. These families have members in late middle age, approaching retirement. Their increased risk comes from the fact that their health care needs and costs are likely to be higher than those of younger families. The limitations of employment-based insurance and the frequency of retirement before the age of Medicare eligibility put both the early retiree and the dependent spouse in danger of losing coverage. In fact, some health conditions and certain chronic illnesses can precipitate early retirements, either for the worker to care for an ill spouse or because work is no longer possible for the ill member of the family. A PUBLIC POLICY PERSPECTIVE Public policies that affect opportunities for and the structure of health insurance coverage have great societal significance, given the harmful impacts on families as well as on individuals that are associated with the lack of insurance.
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Health Insurance is a Family Matter What can the Committee’s analysis in this report on families contribute to policy makers dealing with issues related to health insurance coverage? In its previous report, the Committee highlighted the importance of ease of access to a regular and continuing relationship with a health care professional, which is associated with better health outcomes and is usually facilitated through insurance. In this study the evidence demonstrates that uninsured children are less likely than insured children to have a usual source of health care or a regular physician. For children, gaps in coverage are associated with health access and use that resemble those of chronically uninsured children. There are several limitations of current insurance arrangements that hinder ease of access to a usual source of care for families. There is also evidence that expanding public programs to previously uninsured children brings a significant increase in access to and use of health services. The nature of private and public health insurance means that transitions over the course of family life—job changes, divorce, retirement, death of an insured member—often disrupt health coverage for those who had it. Eligibility for private insurance may exclude some family members because they do not meet specific legal definitions or because a child ages beyond a specified limit. Definitions of eligibility and requirements for re-enrollment in public programs may also contribute to gaps in coverage. While some rules for insurance programs are unavoidable, from the family perspective, some of these definitions and limits may cause disruption and discontinuities that are counterproductive to promoting healthy families. Policy efforts targeted at expanding the limits and definitions of insurance eligibility and smoothing the discontinuities will be examined further in the Committee’s sixth report. Approximately 20 million children are currently covered by Medicaid and the State Children’s Health Insurance Program (SCHIP) program expansions. Nonetheless, almost 5 million children who are potentially eligible for these programs remain uninsured (Urban Institute, 2002a). Recent efforts to simplify the application and re-enrollment processes in many states have contributed to increased coverage. The Committee’s evidence-based review shows clearly that lack of insurance for children reduces access, appropriate utilization, and some health outcomes. In addition, lack of coverage for parents means they are less likely to obtain care or to have positive experiences with the health care system and that this is likely to have a negative impact on their seeking care for their children. The perspective of this report on coverage of families also highlights the importance of the interdependence of individuals within families, the shared health and economic consequences of uninsurance, and the importance of stronger efforts to view the family in its entirety and to consider health insurance for the whole family. Among private, employment-based insurance plans there has been a small but promising trend to expand the definition of family to include both partners in a relationship, for example, unmarried couples, both mixed sex and same sex. This development increases the opportunity for some adults to receive coverage as dependents.
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Health Insurance is a Family Matter OUTLOOK While enrollment in the employment-based insurance market grew during the strong economy of the past decade, continuing growth in enrollment seems less promising now. Recent economic trends relating to recession, a soft labor market, an increasing rate of health cost inflation, and resulting premium increases all support the expectation that employers will be shifting more costs onto their employees. Higher premiums, copayments, and deductibles are likely to result in fewer employees deciding they can afford to take up the offer of coverage for themselves and their families. There are also indications that the trend for employers to reduce the amount of health insurance they offer to their retirees will continue. The Committee notes the recent policy discussions regarding subsidizing Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage for workers who lose their jobs under particular circumstances.1 The discussions recognize the value of health insurance and the need to make it more affordable for workers and their families to keep. Although many workers cannot benefit from COBRA protections (e.g., those whose jobs do not offer health benefits), it could help some workers and their families through some employment-related transitions if it were affordable. The limited real opportunities for coverage available to uninsured workers has recently become more widely understood by the public, but political solutions are yet to be found. The outlook for continuing expansions of Medicaid and SCHIP may also be affected by the recession. Eligibility for Medicaid coverage is likely to grow as unemployment rises. Most state budgets are feeling the constraints of lower-than-forecasted revenues and some may be tempted to cut back on public coverage rather than to expand it (Kaiser, 2001a). Even without formal changes in eligibility, there has been discussion in some states to stop aggressive campaigns to enroll currently eligible children in their SCHIP program because the campaigns are perceived as sufficiently successful that they are increasing program costs. Such cutbacks might mean that fewer of the millions of eligible children will enroll than might have done. The Committee’s final report will examine in further depth both the implications for public policy of the consequences of uninsurance on families and the impact of various programs and policies designed to counteract the negative effects. 1 See footnote 4, Chapter 3, for a brief description of the recently enacted P.L. 170-210, which provides for federal tax credits for health insurance for displaced workers.
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