The Middle Class's Stake in Health Reform

Middle-class families with health insurance might not think they have much at stake in the new health reform law.  But as a recent Center report showed, private health coverage for the middle class is surprisingly unstable.

In about one in four middle-income families with private coverage, those making between $32,000 and $68,000 a year, a family member lost that coverage at some point between 2004 and 2007 (see chart).  Nearly all of these family members ended up uninsured, often for several months.  (An even larger share — 42 percent — of families in the bottom third of the income spectrum contained someone who lost private coverage.)

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While the Census data on which our report is based extend only through 2007, these problems have almost certainly worsened since then due to the recession.

Several core elements of the new health reform law will help families that lose private coverage.  The law will establish “exchanges” giving consumers a choice of private health plans, provide many families with subsidies to help them buy coverage, and reform the individual insurance market to ensure (among other things) that people aren’t denied coverage or charged more because they have pre-existing conditions.