Recession Has Cost Over 6 Million Their Health Insurance

More than 6 million Americans have lost their health insurance in the recession caused by the Coronavirus (and Trump's mishandling of it). As the chart above shows, over 9 million lost it initially and slightly over 2.8 million regained it when they returned to work -- leaving over 6.1 million still without insurance they had before the recession hit.

That didn't happen in other developed nations -- even those hit hard by the virus and its accompanying recession -- only in the United States. Why?

Because the other developed nations guarantee citizens health insurance through the government. That means a citizen losing their job does not lose their health insurance. It's different in the United States. In the U.S., a majority of people are covered by employer-sponsored health insurance (ESI), and when a worker loses his/her job, they also lose their health insurance (and probably the health insurance for their family).

The chart to the right shows the percentage in each industry covered by health insurance through their employer (ESI). These are all in danger of losing that insurance by losing their job.

This pandemic has revealed the serious flaw in the health insurance system in the United States -- the dependence on employers to provide that insurance. This needs to be fixed, and the best fix is to make the government responsible for providing health insurance for all citizens -- like other developed nations do.

Right-wingers (Republicans) will whine that this is "socialism". That's because they don't believe health insurance is a right of citizens. They see it only as a product to be sold to those lucky enough to afford it. They are wrong. Health insurance (assuring medical care) should be a right of every citizen -- and it should be the government's responsibility to see that every citizen is provided with insurance that allows them to receive decent medical care.

Josh Bivens and Ben Zipperer of the Economic Policy Institute (EPI) have written an excellent report of this issue -- and I recommend you read it.

Here is the conclusion from that report:

The inefficiencies and problems caused by the U.S. system of tying access to health insurance to specific jobs is well known. The downsides of employer-based health insurance access have been made spectacularly visible by the COVID-19 shock—a shock that has cost millions of Americans their jobs and their access to health care in the midst of a public health catastrophe.

Delinking access to health insurance from specific jobs should be a top policy priority for the long term. The most ambitious and transformational way to sever this link is to make the federal government the payer of first resort for all health care expenses—a “single-payer” plan. The federal government already is the primary insurer for all Americans over the age of 65 and for households with incomes low enough to qualify for Medicaid. The advantages of a single-payer system are large, both in ensuring consistent access to medical providers that households prefer and in restraining the often-rapid growth of health care costs.

Absent a once-and-for-all switch to a single-payer system, policymakers can take smaller steps to delink health insurance from specific jobs. They could lower the age of eligibility for Medicare, raise the income thresholds for Medicaid eligibility, and/or incorporate into the ACA marketplace exchanges a public option that enrolls all workers without job-based insurance—even those with access to ESI if they prefer the public option instead. Policymakers could also require that employers either provide comprehensive and affordable insurance or pay a fee to help cover the costs of enrolling their workers in the public option.

Finally, the lowest-hanging fruit in the current crisis is to have the federal government pay all expenses for COVID-19-related testing and treatment. Given the historically rapid increase in uninsurance in the first months of the COVID-19 shock, policymakers should also allow all those without insurance to enroll in Medicaid, regardless of income, for the duration of the crisis.

The COVID-19 shock has exposed just how incomplete and threadbare the U.S. safety net and social insurance system is. We should begin building a better set of systems that provide economic security to U.S. workers.