Uninsurance Rate Drops to 8.9% in Q3 2021, Nears Record Low

The uninsurance rate in 2021 fell below pre-pandemic levels, according to a report from the Assistant Secretary for Planning and Evaluation’s (ASPE) Office of Health Policy. CMS followed up by announcing more funding to reduce children's uninsurance.

“Despite the COVID-19 pandemic and widespread economic challenges, the US uninsured rate has declined over the last 12 months of available data—due primarily to growth in private coverage and to a lesser extent public coverage,” the researchers found. 

“Potential factors contributing to this stability in health coverage during the pandemic include months of strong economic recovery with record job growth, legislative and administrative actions to help Americans maintain and gain affordable coverage, and implementation of Medicaid expansion in additional states.”

The researchers analyzed data from the Centers for Disease Control and Prevention’s (CDC) National Health Interview Survey (NHIS), the Department of Labor, and Marketplace enrollment. Primarily, they looked at data from the final quarter of 2020 to the third quarter of 2021.

The uninsurance rate dropped from 10.3 percent in the fourth quarter of 2020 to 8.9 percent in the third quarter of 2021. Approximately 4.6 million individuals gained coverage in that same timeframe.

This nearly reaches the lowest recorded levels of uninsurance experienced in 2016 and early 2017, when the uninsurance rate was 8.6 percent according to the American Community Survey as cited by the US Census Bureau.

The trend across each quarter was also unusual historically. In 2018, 2019, and 2020, the uninsurance rate rose over the course of the year, quarter by quarter. But in 2021, the uninsurance rate began to drop in the second quarter.

The subpopulation that saw the highest growth in coverage was the group of enrollees with incomes under 200 percent of the federal poverty level. 

The uninsurance rate among individuals with incomes below 100 percent of the federal poverty level declined steadily from 20.2 percent in the fourth quarter of 2020 to 16.2 percent in the third quarter of 2021. Among Americans with incomes between 100 percent and less than 200 percent of the federal poverty level, uninsurance dropped from 21.3 percent to 17.1 percent. 

Coverage gains in the private sector exceeded the gains in the public sector for individuals under 65 years of age. The private sector saw a 1.0 percentage point increase in coverage from 63.2 percent to 64.2 percent. Meanwhile, public payer insurance coverage grew from 26.3 percent to 26.9 percent.

The widespread job losses during the first wave of the coronavirus pandemic did not result in higher uninsurance overall, although some groups such as women, lower-income individuals, and minority groups suffered more coverage losses.

American Rescue Plan’s expanded Affordable Care Act marketplace subsidies, the suspension of Medicaid eligibility terminations in the Families First Coronavirus Response Act (FFCRA), and Medicaid expansion helped to reduce uninsurance, the researchers determined. Enhanced outreach efforts and the special enrollment period also played a role in decreasing the uninsurance rate.

According to the ASPE report, children saw a 2.2 percentage point drop in uninsurance from 6.4 percent to 4.2 percent, while individuals under the age of 65 saw a 1.6 percent decrease in uninsurance.

To support the decline in children’s uninsurance, CMS announced that it was offering $49.4 million in grants to organizations that connect uninsured children to Medicaid and the Children’s Health Insurance Program (CHIP) coverage. Grant recipients will receive $1.5 million for a three-year timeframe.

“CMS is using every tool available to expand access to coverage and care,” said CMS Administrator Chiquita Brooks-LaSure. “These organizations play a pivotal role in connecting people to coverage since families and individuals often seek help from community organizations they know and trust.”

CMS noted that this is an unprecedented amount of funding to put toward this goal. The agency will accept applications through March 28, 2022.