Close to Half of Working Poor Parent Lack
Health Insurance
Most States Not Yet Using New Option to Cover These Parents
Table of Contents Press
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Nearly half of all poor working parents lacked health insurance coverage throughout 1997, according to a new study the Center on Budget and Policy Priorities released today. The study found that working poor parents were twice as likely to be uninsured as poor parents who are unemployed.
The report, Employed but Not Insured: A State-by-State Analysis of the Number of Low-Income Working Parents Who Lack Health Insurance, also finds that few states have yet to take advantage of a new option the welfare law created that allows states to extend Medicaid coverage to low-income parents. The report notes, however, that a number of states are beginning to consider this option.
The findings of the report, which is based on Census data and provides data for the first time on the number and percentage of low-income working parents in each state who lack insurance, include the following:
- Forty-six percent of the 4.9 million working parents with income below the federal poverty line — $13,650 for a family of three — were uninsured in 1997.
- More than one of every three parents with incomes below 200 percent of the poverty line ($27,300 for a family of three) — or 34.5 percent of such parents — lacked insurance in 1997.
Due to changes in welfare programs and a robust economy, fewer low-income parents are now receiving welfare and the Medicaid coverage that typically comes with it. As a result, more of these parents are working at low-wage jobs that offer no health insurance coverage and have joined the ranks of the uninsured.
Jocelyn Guyer, health policy analyst at the Center and the report's principal author, stated: "With employer-based coverage for low-wage workers on the decline, the number of low-income uninsured parents is growing." Guyer added that "this lack of coverage can undermine the goals of welfare reform by forcing low-income parents with a medical condition to choose between their jobs and their health."
State Medicaid Programs Not Filling the Gap
The report finds that most states are not filling these gaps by offering coverage to low-income working parents through Medicaid. Although most states provide coverage to poor and near-poor children in low-income working families, their parents remain without insurance.
- In the typical state, working parents cannot qualify for Medicaid if their earnings exceed 59 percent of the poverty line, or $7,992 a year for a family of three.
- In nine states — Alabama, Arkansas, Florida, Idaho, Indiana, Louisiana, Texas, Virginia and West Virginia — parents cannot qualify for Medicaid if their earnings are above 37 percent of the poverty line, or $5,050 for a family of three.
- A parent in Alabama working at the minimum wage earns too much to qualify for Medicaid if she works more than 11 hours a week at the federal minimum wage of $5.15 an hour. If her job pays $7 an hour, she cannot qualify for Medicaid if she works more than 8 hours a week.
- In Indiana, a parent is ineligible for Medicaid if he works more than 17 hours a week at the minimum wage, while a parent earning $7 an hour is ineligible if he works more than 12 hours a week.
While there are some situations in which parents with somewhat higher earnings can still qualify for Medicaid, the report noted, state Medicaid rules leave vast numbers of low-income working parents without coverage.
"Parents trying to support their families with very low wages often have nowhere to turn if they need health insurance," Guyer stated. The Center's report includes data on the level of earnings at which a parent loses Medicaid eligibility in each state, as well as data on the number of hours of work in each state at which a parent employed in a minimum wage job or a $7.00-an-hour job fails to qualify for Medicaid.
In addition, some 21 states fail to extend Medicaid coverage to most parents in two-parent households. According to the report, rules in these states that largely limit coverage to parents in single-parent households stem from an old, and now widely discredited, policy left over from the old welfare system.
New Option Allows States to Close Gaps
"Although states vary in their coverage of working parents, this should not be viewed as a report about good versus bad states", noted Cindy Mann, Senior Fellow at the Center and co-author of the report. "Many of the states that rank low on the list for covering parents have expanded coverage in recent years for children in low-income working families. Some of these states also have now begun to consider expanding coverage to the working parents of these children."
Until recently, federal Medicaid rules generally denied states the option to cover parents who were not currently receiving welfare or had not recently received it. "Federal law has changed," Mann said. "States now have a new option to extend Medicaid to low-income working parents." She added that many states still seem unaware of the new option.
Under the option, the federal government will finance half to more than three-fourths of the cost of extending health insurance coverage through Medicaid to low-income working parents, with the exact percentage of the federal government's share depending on each state's Medicaid matching rate. "This option gives many states what they are looking for," Mann observed, "offering them federal matching dollars to turn their child health initiatives into family coverage initiatives for working poor families." She added that "state policymakers are beginning to recognize that using this option to provide coverage to low-income working parents can promote work and help states meet their welfare reform goals."
In recent months several states have taken advantage of the new option to expand coverage for low-income working parents, the report said.
- In October 1998, Rhode Island began covering parents with incomes up to 185 percent of the poverty line, $25,252 for a family of three. The state covers parents in both two-parent and single-parent households. The District of Columbia initiated a similar policy last fall; its eligibility limit for parents is set at 200 percent of the poverty level, or $27,300 for a family of three.
- Missouri and Wisconsin recently acted to extend Medicaid coverage to low-income working parents. Their coverage initiatives are set to take effect in coming months.
See Tables 1 and 2 for state-by-state data on the number and percentage of uninsured working parents in each state. Due to small sample sizes in Census Bureau state-by-state data, these numbers provide an approximate rather than an exact measure of the magnitude of the coverage gap in each state; because they are approximate rather than exact and because the sample sizes are smaller in some states than in others, these data should not be used to compare uninsured rates across states.
See Tables 3 and 4 for data on the level of earnings that will make working parents who are applying for Medicaid ineligible for coverage in each state.
See Table 8 for each state's federal Medicaid matching rate.
State Contacts for Employed But
Not Insured
Contact these groups for comment and information about local press
activity
Alabama
Mary Weidler
Alabama Arise
334-832-9060California
Lucy Quacinella
National Center for Youth Law
415-543-3307Colorado
Buffy Boesen
Catholic Charities Colorado
303-742-0823 x304Connecticut
Judith Solomon
Children's Health Council
860-548-1661Sharon Langer
Connecticut Legal Services
860-225-8678 ext. 108Jane McNichol
Legal Assistance Resource Center ofConnecticut
860-278-5688 ext. 15Florida
Daniella Levine
Dade County Human Services Coalition
305-576-5001Georgia
Laurie Iscaro
Georgians for Children
404-365-8948Linda Lowe
Families First
770-259-7518Idaho
Judith Brown
United Vision of Idaho
208-882-0492Indiana
Beryl Cohen
Indiana Coalition on Housing and Homeless Issues, Inc.
317-636-7244Kansas
Mary Becker
Kansans Respond
785-232-8663Kentucky
Anne Joseph
Kentucky Task Force on Hunger
606-266-2521Michigan
Sharon Parks
Michigan League of Human Services
517-487-5436Gary Gershon or Michael Nelson
Michigan Poverty Law Program
616-454-5055Terri Stangl
Center for Civil Justice
517-755-3120Mississippi
Warren Yoder
People and Policy Center of Mississippi
601-291-2990Nebraska
Milo Mumgaard
Nebraska Appleseed Center for Law in the Public Interest
402-438-8853New Jersey
Regina Purcell
NJ Catholic Conference
609-599-2110Leighton Holness and Thomas A. Makin
Legal Services of New Jersey
732-572-9100Nevada
Lisa Appelrouth Guzman
Nevada Empowered Women's Project
775-348-9566New York
Jennifer Cunningham
1199 National Health and Human Service Employees Union, SEIU
212-631-4658Rima Cohen
Greater New York Hospital Association
212-506-5527Anne Erickson
Greater Upstate Law Project, Inc.
518-462-6831Oregon
Chuck Sheketoff
Oregon Center for Public Policy
503-873-1201South Carolina
Elizabeth Bangston Hutto
South Carolina Appleseed Legal Justice Center
803-777-6944Lenora Bush Reese
South Carolina Fair Share
803-252-9813South Dakota
Carol Robertson
South Dakota Community Concepts
605-224-0081Texas
Anne Dunkelberg
Center for Public Policy Priorities
512-320-0222Wisconsin
Jon Peacock
Wisconsin Council on Children and Families
608-284-0580
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