BUSINESS NEWS
Median household income stayed flat while number of uninsured rose
Paul Davidson and Charisse Jones
USA TODAY
Published 2:32 PM EDT Sep 10, 2019
For the first time in a decade, more Americans went without health insurance in 2018, the Census Bureau said Tuesday.
The drop came as the Trump administration took steps to weaken the Affordable Care Act and toughen Medicaid requirements.
It contributed to a mixed picture of household financial health last year as median income was stagnant while poverty declined.
The median U.S. household income was $63,179, according to the Census Bureau, up 0.9% on an inflation-adjusted basis from the $61,372 midpoint in 2017. Census said the change wasn’t statistically significant, suggesting median income was roughly flat. That followed gains of 5.2% in 2015, 3.2% in 2016 and 1.8% in 2017.
Household income includes bonuses, Social Security, public assistance payments and interest and dividends from investment, among other sources.
The record 10-year-old economic expansion continued to provide jobs to more Americans, lifting many out of poverty. There were 38.1 million people living in poverty last year, about 1.4 million fewer than in 2017. The poverty rate fell for the fourth straight year, from 12.3% to 11.8%. For the first time in 11 years, the rate was significantly lower than in 2007, the year before the Great Recession.
While the declining poverty rate was heartening, some experts said the stagnant median household income signaled that many Americans still struggle to make ends meet.
“There’s some good news in this report,’’ said H. Luke Shaefer, director of Poverty Solutions at the University of Michigan. But “we still see there’s large numbers of people who are spending a significant fraction of their income on rent.”
With median income staying flat, he added, “I think there’s a lot of people who feel like they can’t pay their bills and aren’t making progress.’’
After accounting for inflation and measurement changes, median household income is just above the prerecession mark in 2007 but slightly lower than the 2000 level, according to the left-leaning Economic Policy Institute.
“Most families have just barely made up the ground lost since 2000,” said Elise Gould, senior economist at EPI.
The number of full-time, year-round workers increased by 2.3 million in 2018. The unemployment rate fell to 3.9% at the end of last year from 4.1% 12 months earlier and 10% in 2009.
Poverty fell in every region but the South, where the rate was unchanged at 13.6%. But for the first time since 2009 and since the Affordable Care Act took effect in 2014, more Americans went without health insurance.
About 27.5 million people didn’t have coverage, up from 25.6 million the prior year as the share of those uninsured rose to 8.5% from 7.9%. The portion with government-provided coverage fell nearly half a percentage point while the share with private insurance was largely unchanged. The Trump administration has taken steps to weaken the health care law – such as repealing a requirement that Americans have coverage or pay a penalty – and issued guidance that allows states to revoke Medicaid from people who aren’t working a minimum number of hours each month. Also, some states rejected an expansion of Medicaid coverage.
The Kaiser Family Foundation, which focuses on issues around insurance and health, took to Twitter to sound an alarm about the growing number of Americans without coverage.
“The number of people uninsured is rising even in a pretty good economy,’’ wrote Larry Levitt, the foundation’s executive vice president for health policy. “What’s going to happen when a recession hits?”
While some Americans have said they’re unsure what policy options are available under the ACA during the Trump administration and whether they should apply at all, that confusion may be just one element of what is contributing to fewer people being insured, said Rachel Garfield, the Kaiser Foundation’s vice president and co-director of the program on Medicaid and the uninsured.
“It’s not immediately clear which specific thing it is,” she said. “Is it the economy? Is it the ACA implementation? Is it how states are operating Medicaid expansion? It’s more likely a combination of all of those things coming together. ’’
While overall income was static, median inflation-adjusted earnings for all workers increased by 3.4% to $40,247. The median pay for men rose 3.4% to $55,291 while the median for women climbed 3.3% to $45,097.
Women earned 82% of male pay on average, similar to 2017, the Census Bureau said.
Median household income can be flat even while typical workers’ wages are rising if some members of a household stop working or cut back to part time. And household income also includes payments other than earnings, such as Social Security, interest and dividends.
Income inequality improved modestly but remained glaring. The top quintile, or fifth, of Americans by income received 50.3% of all income, down from 50.9% in 2017, after adjusting the figures for cost efficiencies in larger households. Those in the bottom quintile saw their share rise to 3.5% from 3.4%.
Among racial groups, inflation-adjusted income was stagnant for white households, at $70,642, for blacks at $41,361 and for Hispanics $51,450. Median income for Asian households rose 4.6% to $87,194.
