Estimate Shows Uninsured Population Rising by 2.9M By End of 2020

Approximately 31.5 million individuals will be uninsured by the end of the year, largely stemming from job losses related to the COVID-19 pandemic, according to new estimates from the Urban Institute.

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Because of pandemic-related job losses, researchers at the non-profit think tank are projecting the uninsured population to grow by 2.9 individuals in the last three quarters of 2020, representing a 10.0 percent increase.

The total number of uninsured individuals by the end of the year will represent about 11.4 percent of the non-elderly US population, researchers stated a report released earlier this month.

The microsimulation model developed by the Urban Institute in June 2020 also projected millions of more people to lose employer-sponsored health coverage through the end of 2020.

An estimated 48 million non-elderly individuals will be part of a household in which someone loses a job due to COVID-19 in the last three quarters of 2020, the projections on more than 6 million sample individuals revealed. Of those individuals, about one-fifth, or 10.1 million, people had insurance tied to the job lost due to the pandemic.

Using employment losses reported by the US Department of Labor, researchers estimate that 32 percent of these people will switch to another source of employer coverage through a family member, 28 percent will enroll in Medicaid, and 6 percent will enroll in the non-group market, primarily through the Affordable Care Act’s marketplace coverage with premium tax credits.

The remaining 3.5 million people in this group will become uninsured by the end of the year, with about 500,000 of these individuals being uninsured before the pandemic and becoming eligible for Medicaid and enrolling the program, according to results from the microsimulation model.

Overall, researchers project coverage changes due to pandemic-related job losses to result in 7.3 million fewer people with employer-based coverage; 4.3 million more people in Medicaid or the Children’s Health Insurance Program (CHIP); and 2.9 million people become uninsured.

Meanwhile, enrollment in non-group coverage through the end of 2020 is projected to increase by just 200,000 people, on net.

The Urban Institute said the projected losses of employer-sponsored health coverage are likely to be lower than expected during the last three quarters of 2020 because pandemic-job losses have been concentrated among individuals who did not have access to employer-sponsored health coverage prior to the pandemic.

“These estimates align with evidence that the COVID-19 recession is hitting people with low incomes and less educational attainment the hardest,” researchers wrote in the report.

The projections also indicated that the Affordable Care Act’s health insurance safety net is “working as intended” in Medicaid expansion states.

The Affordable Care Act provided states with the option to expand Medicaid eligibility to more low-income residents. According to the latest data from the Kaiser Family Foundation, 38 states, including Washington DC, have adopted Medicaid expansion and 13 states have chosen not to adopt the expansion.

Medicaid expansions have been linked to lower uncompensated care costs for hospitals and fewer hospital closures. Now, researchers are reporting that people living in states that expanded Medicaid will be shielded more from losing their employer-sponsored health coverage as a result of the pandemic.

In states that have not expanded Medicaid, the Urban Institute’s microsimulation model projected over half (55 percent) of the number losing employer-sponsored health coverage as a result of pandemic-related job losses to become uninsured in the last three quarters of 2020.

In contrast, only 34 percent of those losing employer coverage in Medicaid expansion states are estimated to become uninsured by the end of the year.

HHS has promised to cover uncompensated care costs for uninsured COVID-19 admissions using coronavirus relief funds provided through the Coronavirus Aid, Relief and Economic Security (CARES) Act and subsequent legislation.

However, healthcare providers fear that the government’s funding of uninsured COVID-19 care – which could account for as much as a quarter of the $175 billion Provider Relief Fund – will not be enough to support hospitals struggling with persistent funding shortages as a result of the pandemic.

The American Hospital Association (AHA) has urged HHS to look at other ways to provide coverage for the uninsured population other than using CARES Act funding for providers, including a special enrollment period for the marketplaces, Medicaid expansions, and the National Disaster Medical System.

“The emergency relief fund in the CARES Act was intended to provide hospitals with an infusion of emergency relief as providers incur substantial expenses in preparing and dealing with fighting this battle against COVID-19,” said Rick Pollack, AHA president and CEO.

As of July 16, 2020, over 13,000 providers have received claims reimbursement for testing and treated uninsured COVID-19 patients, according to data from the federal government.