February 22, 2012

For Immediate Release: February 22, 2012
Contact: Alan Barber, (202) 293-5380 x115

Washington, D.C.- Three-fourths of low-wage workers do not have health insurance through their employer and almost 40 percent have no health insurance from any source, according to a new report from the Center from Economic and Policy Research (CEPR) and the Georgetown University Kalmanovitz Initiative for Labor and the Working Poor.

By analyzing changes in coverage rates by wage-level and race over the last 30 years, this report fills a major gap in the available research and shows how low-wage workers, especially Latinos, have been uniquely affected by declines in employer-provided health insurance.

Over the last three decades, employer-provided health coverage has fallen for all workers, but the decline has been steepest for low-wage workers, the report notes. In 1979, 43 percent of low-wage workers had employer-provided health insurance. In 2010, the most recent data available, only 26 percent had health insurance through their employer.

Other forms of health insurance have not made up for falling employer-provided coverage. In 1979, 16 percent of low-wage workers had no health insurance of any kind. In 2010, 39 percent of low-wage workers had no health insurance from any source, private or public. Only 13 percent of low-wage workers had some form of public coverage, including Medicaid. For Latinos, the numbers are sharper: almost 40 percent of Latino workers have no coverage at all.

The report also estimates the impact of the Affordable Care Act (ACA) on future coverage rates for low-wage workers. Based on outside projections and the experience of Massachusetts, whose state system shares many features with the ACA, the report concludes that full implementation of the ACA would cut non-coverage rates for low-wage workers to below 20 percent, from the current level of close to 40 percent.

"Low-wage workers face enormous challenges obtaining health insurance for themselves and their families," said John Schmitt, a senior economist at the CEPR and the author of the report. "The Affordable Care Act could have done more, but complete implementation will greatly expand coverage for low-wage workers,"

The report, "Health-Insurance Coverage for Low Wage Workers, 1979-2010 and Beyond," defines low-wage workers as the bottom 20 percent by hourly pay and uses data from the Current Population Survey (CPS) to calculate coverage rates from all sources of health insurance, including workers' own employers, other family members' employers, directly purchased policies, Medicaid, and other public sources.

The report was prepared for a conference on low-wage work, to be jointly hosted Thursday, Feb. 23, and Friday, Feb. 24, at Georgetown University by Georgetown University's Kalmanovitz Initiative on Labor and the Working Poor and the Joseph S. Murphy Institute for Worker Education and Labor Studies at the City University of New York.

"Skyrocketing inequality and stagnating wages create an imperative need for research on the causes—and solutions—for economic polarization," said Jennifer Luff, Research Director of the Kalmanovitz Initiative. "Raising standards for low-wage workers through programs like affordable health insurance is critical to reversing these trends."

The full report can be found here.



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