COVID-19 Amplifies Racial Health Disparities for Coverage

Minorities may see a sharper loss in employer-sponsored health insurance than White populations in America, which would drive racial coverage and health disparities even deeper, a recent report from Avalere exposed.

“These results reflect the disproportionate impact COVID-19 is having on the health insurance coverage of communities of color. The percentage loss of health insurance coverage among Asian, Black, and Hispanic individuals is approximately double that of White individuals,” said Chris Sloan, associate principal at Avalere.

Unemployment due to the coronavirus pandemic has been more common for traditionally marginalized populations than for White people, particularly among the Asian and Hispanic communities.

These job losses could leave many individuals in these minority communities without health insurance. Avalere experts estimated that Black individuals and Hispanic individuals would see the highest loss of employer-sponsored health insurance among minority populations that they observed.

Two million Black people (or 13 percent of the Black community) and three million Hispanic people (or 13 percent of the Hispanic community) could lose their employer-sponsored health plans by the end of 2020.

In the context of demographic population sizes, these losses, separately, could be more than twice the percent of employer-sponsored coverage loss among White people.

The recently unemployed have multiple options for healthcare coverage after losing their employer-sponsored health plans, including going on to the individual health insurance market, a public payer program like Medicaid or Medicare, or they could become uninsured.

The Avalere researchers gave no predictions regarding what replacement coverage options would be most popular for Black and Hispanic unemployed individuals. However, they did note that individuals from the Black and Hispanic communities are already far more likely to be in a public program than individuals from White or Asian communities are.

Before the pandemic, 27 percent of Black individuals and 29 percent of Hispanic individuals were in Medicaid, almost triple the number of White individuals in Medicaid (11 percent).

Furthermore, 11 percent of Black people and 18 percent of Hispanic people were uninsured, as opposed to six percent of White people, according to 2018 data from the American Community Survey.

Loss of employer-sponsored healthcare coverage could present challenges for those with complex or pre-existing conditions who need a more robust care plan and provider network.

While Medicaid expansion has helped states overcome some racial disparities in Medicaid beneficiary access to care, disparities in coverage existed before the pandemic and are further solidifying in the context of coronavirus, according to Avalere experts.

“Overall, the shift away from employer-sponsored insurance could be challenging for patients,” said Tom Kornfield, senior consultant. “Many of these patients could face less generous benefit design, greater cost sharing, and more limited formularies in Medicaid or in the individual market.”

Experts have arrived at various conclusions about the true impact that coronavirus will have on employer-sponsored health insurance in 2020. A recent study of the most prominent research on the subject determined that, while the outlook remains unclear, it is likely to be less drastic for employer-sponsored health insurance than originally anticipated.

“We do not yet know how many people will lose both their jobs and health insurance coverage during the COVID-19 recession, and definitive data will not be available until next year,” the researchers stated.

“Early evidence indicates there have not yet been large losses of coverage, suggesting that studies predicting smaller changes in the number of uninsured people may be more accurate than those predicting large increases.”

The Avalere researchers stressed the effects of Medicaid expansion in lessening coverage disparities, among its other benefits. Some studies have argued that Medicaid expansion could lower uninsurance during the pandemic, for example.

Between 2013 and 2016, the first couple of years that the Affordable Care Act was in effect, uninsurance for nonelderly Hispanic and Black individuals fell almost ten percentage points each—from 30 percent to 19 percent for Hispanic persons and from 19 percent to 11 percent for Black persons, Avalere researchers shared.

“While any single policy change is unlikely to fully eliminate the longstanding inequities in healthcare, considering racial disparities in coverage in policy discussions may mitigate these challenges and facilitate increased access to care,” the researchers concluded.