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Commentary

California's Uninsured: Crisis, Conundrum, or Chronic Condition?
John R. Graham, Pacific Research Institute, 1-10-06

The media routinely estimates the number of uninsured Americans at around 45 million, but there are reasons to suspect that that figure is a serious overcount. In California, John Graham, director of Health Care Studies at the Pacific Research Institute, has released a report arguing that estimates of uninsured Californians may be off by as much as 100%.

According to Graham, "The problem of Californians without health insurance may not be as awful as generally portrayed. The number of Californians without health insurance for an entire year (whether legal or illegal) is likely around 9 percent."

Graham calculated this figure by scaling down the U.S. Census Bureauís national Survey of Income and Program Participation (SIPP) data, which estimated that 6.8 percent of U.S. residents were without health insurance for a year. The SIPP data is considered more accurate by Graham and other researchers than the often cited "Income, Poverty, and Health Insurance Coverage," also compiled by the U.S. Census Bureau.

Graham also noted that non-citizens, many of whom are illegal, have a much lower rate of health insurance than citizens, no matter what ethnicity. "Because California has a much higher share of illegal immigrants than other states," said Graham, "this is really a challenge of illegal immigration, not health insurance." Moreover, a number of people who are eligible for government programs fail to enroll in them, causing almost a million children to go uninsured. "These points taken together, California's uninsured may not necessarily be higher than the national averages," concluded Graham.

This is an important point, because it indicates that targeted efforts—particularly using Health Savings Accounts, as Graham suggests—can widen the availability of health insurance without creating large new (and expensive) public programs. Another good approach would be to reduce the burden of state insurance regulations, which Graham estimates may drive up the price of health insurance in California by as much as 30 percent.



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