The Impact on the Uninsured of the Baby Boom Generation Reaching Age 65

By Paul Fronstin, EBRI

This week the Census Bureau released its annual report on income, poverty and the uninsured. The number of uninsured increases naturally because of population growth even when the percentage declines, but in 2011 both the percentage of the population and the number uninsured declined: Between 2010 and 2011, the percentage uninsured fell from 16.3 percent to 15.7 percent and the number fell from 50 million to 48.6 million. In fact, 2011 was only one of four years since 1994 that saw a decline in the percentage uninsured.

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Why did both those measures fall in 2011?

Some segments of the population did see an increase in employment-based coverage, notably young adults taking advantage of the adult dependent mandate in the Affordable Care Act (ACA), but these gains were offset by other loses (such as the decline in coverage from one’s own job for workers of all ages), negating any impact on the aggregate decline in the uninsured. The percentage of the population with employment-based health benefits stood at 55.1 percent in 2011, compared with 55.3 percent the previous year, so it would not account for the decline in the uninsured.

There was growth in the number of people covered by Medicaid and SCHIP (the State Children’s Health Insurance Program). In 2011, 16.5 percent of the population had Medicaid or SCHIP, up from 15.8 percent in 2010. So this increase accounted for some of the decline in the uninsured.

Overall, the decline in uninsured was largely associated with a rise in the share of people covered by government-sponsored health plans, increasing to 32.2 percent in 2011 from 31.2 percent in 2010.

Coincident with this trend, it’s worth noting that the leading edge of the Baby Boom generation (the cohort of individuals born between 1946‒1964) turned 65 in 2011, meaning that this generation is finally reaching Medicare eligibility.

Statistically, 65-year-olds have now reached 1 percent of the total U.S. population. While not yet a large number, it is the largest in recent history, driving up Medicare enrollments, and perhaps marking the cusp of a significant demographic shift in insurance trends.

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