For people who lose employer-sponsored coverage, the individual market is often the only alternative, but it is a confusing and largely unaffordable option.As the Supreme Court wrestles with the constitutionality of the Affordable Care Act of 2010, a new report found that 26 percent of working-age adults experienced a gap in health insurance coverage during 2011, often because they lost or changed jobs. The recently released report by the Commonwealth Fund, a non-profit foundation that examines healthcare issues, shows it is difficult for people to regain health insurance on their own after losing employer-sponsored coverage.
More than two-thirds, or 69 percent, of those who had a time without health insurance coverage had gone without coverage for a year or longer, and more than half, or 57 percent, were uninsured for two years or more according to the report, which was based on the 2011 Commonwealth Fund Health Insurance Tracking Survey of U.S. Adults.
Among those who were uninsured at the time of the survey or who had experienced an insurance gap, 41 percent said they had previously had employer-sponsored coverage. In that group, two-thirds said a loss or change of a job was the primary reason for losing coverage.
Most could not buy insurance on their own because it was either too expensive or because they were excluded due to pre-existing conditions. Many also found it difficult to compare the benefits provided by different plans.
“For people who lose employer-sponsored coverage, the individual market is often the only alternative, but it is a confusing and largely unaffordable option,” says Commonwealth Fund Vice President Sara Collins, lead author of the report. “As a result, people are going a year, two years, or more without health care coverage, and as a result going without needed care.”
While almost all working-age adults with health insurance reported having a regular doctor, as people lost coverage, they stopped having regular preventive checkups to test for cholesterol and blood pressure. Rates of preventive cancer screening continued to drop as people spent longer periods without insurance.
The report also found that already implemented provisions of the Affordable Care Act are making a difference in bridging coverage gaps, especially the provision that allows adult children up to age 26 to join or stay on a parent’s health insurance plan. Nearly half, or 46 percent, of young adults ages 19 to 25 said they had stayed on or joined a parent’s insurance policy in the last 12 months, and about a quarter, or 23 percent, of parents with children under age 26 reported that they had an adult child stay on or enroll in their health plan.
Awareness of this new provision was high among working-age adults, with almost two-thirds, or 63 percent, saying they were aware of the provision. Half of adults were also aware that people with pre-existing conditions who had previously been unable to get health insurance, could now obtain coverage under the new law.
The major provisions of the health reform law, to be implemented starting in 2014, will have the biggest effect in bridging health care coverage gaps, the authors say, through an expansion in eligibility for Medicaid, subsidized private insurance available through new state health insurance exchanges, and new rules that will prevent insurers from denying coverage or charging people more based on pre-existing conditions or gender.
The law will also make it easier for consumers who must buy health insurance on their own to purchase a health plan that meets their needs through clearly defined benefit packages and tools to help consumers choose among plans. The new insurance exchanges, for example, will be required to offer a cost-calculator that will inform families about their health plan costs after adjusting for any premium or cost-sharing subsidies.
“The current system of health insurance in the United States has gaping holes, the effects of which have become increasingly pronounced during a weak economy,” says Commonwealth Fund President Karen Davis. “The Affordable Care Act is beginning to close those gaps, so that people who are already struggling can maintain health care coverage that will provide for their families’ health and help ensure their financial security.”
The report, the second in a series tracking changes in coverage and health care as the Affordable Care Act is implemented, was based on a survey of 2,134 people between the ages of 19 and 64, including 977 low-income adults.
April 20, 2012