Next Steps in Incremental Health Insurance Expansions:

Originally published by the Center for Studying Health System Change (HSC). HSC was a nonpartisan policy research organization funded principally by the Robert Wood Johnson Foundation.

Who is Most Deserving

Issue Brief No. 12, April 1998 -- Peter J. Cunningham

President Clinton had proposed allowing near-elderly individuals -- those between ages 55 and 64 -- to buy into Medicare, the latest incremental initiative to expand health insurance coverage by targeting specific age groups. Congress had recently passed expansions for children, and assistance for young adults ages 19 to 24 had been discussed. The rationale for targeting these groups rested on presumed vulnerability. But vulnerability encompasses not just the risk of being uninsured, but also the health and financial consequences of lacking coverage -- consequences that vary substantially across age groups. This analysis examined vulnerability for the near-elderly and young adults.

Understanding Vulnerability to Uninsurance

Using Community Tracking Study Household Survey data, this analysis compared near-elderly persons with young adults and children on the risk of being uninsured and availability of coverage; health status and care utilization differences indicating potential consequences; and the ability of uninsured persons to obtain needed care.

Uninsurance Rates Across Age Groups

Young adults ages 19-24 had the highest uninsurance rate at approximately 28 percent, substantially above children (14 percent) and the near-elderly (13 percent). Young adults were aging out of parents' plans, more likely to work without coverage, and less likely to qualify for public programs. The near-elderly, while having lower overall rates, faced distinctive problems: unaffordable individual market coverage due to health conditions and age-based pricing, and the gap between early retirement and Medicare eligibility at 65. Children's uninsurance was concentrated in low-income families, addressed by the new CHIP program.

Health Status and Needs by Age

The near-elderly had significantly higher rates of chronic conditions -- about 35 percent reported conditions like heart disease, diabetes, or cancer. They used more physician visits, hospitalizations, and medications. Being uninsured posed serious financial and health risks for this group, with potentially devastating out-of-pocket costs and deterioration of manageable conditions. Young adults were generally the healthiest age group with low chronic disease rates, though accidents and acute conditions could generate catastrophic debt. Children needed preventive services especially, and uninsured children were more likely to miss immunizations and well-child visits.

Access to Needed Care

Across all age groups, uninsured individuals were less likely to have a usual care source, less likely to have had an ambulatory visit, and more likely to report unmet needs. For uninsured near-elderly, nearly a third reported not getting needed medical care, compared with about 8 percent of insured peers. While uninsured young adults also faced access barriers, the immediate health consequences tended to be less severe given their better health status.

The Complexity of Targeting Coverage Expansions

These findings complicated the task of prioritizing coverage expansions. By uninsurance rates alone, young adults had the strongest claim. But by health consequences and financial risk, the near-elderly had a more compelling case given their greater chronic disease burden and larger financial exposure. Vulnerability to uninsurance is not one-dimensional -- the risk of being uninsured, health consequences of lacking coverage, and ability to obtain care when uninsured all vary across age groups in ways that do not always point to the same policy priority.

Different underlying causes of uninsurance also implied that no single policy mechanism would serve all groups effectively. The Medicare buy-in addressed the near-elderly's specific structural barriers. Young adults might benefit more from employer coverage mandates or extension of parents' coverage. For children, CHIP was already underway. Understanding each group's distinct vulnerability dimensions was essential for evidence-based coverage expansion policies.

Sources and Further Reading

Kaiser Family Foundation — Employer Health Benefits — Annual employer survey data.

CMS — Health Insurance Marketplace — Federal marketplace information.

Health Affairs — Peer-reviewed health policy.

Robert Wood Johnson Foundation — Health policy research.

Commonwealth Fund — Research on health coverage.