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Journal Issue: The Next Generation of Antipoverty Policies Volume 17 Number 2 Fall 2007

A Health Plan to Reduce Poverty
Alan Weil


  1. Kaiser Commission on Medicaid and the Uninsured, Health Insurance Coverage in America 2005 Data Update (Washington, November 2006), p. 14.
  2. Committee on the Consequences of Uninsurance, Institute of Medicine, Coverage Matters (Washington: National Academies Press, 2001).
  3. Committee on the Consequences of Uninsurance, Institute of Medicine, A Shared Destiny: Community Effects of Uninsurance (Washington: National Academies Press, 2003).
  4. Amy Davidoff and Genevieve Kenney, Uninsured Americans with Chronic Health Conditions: Key Findings from the National Health Interview Survey (Washington: Urban Institute, May 2005), p. 4.
  5. Paul Fronstin and Sara R. Collins, The 2nd Annual EBRI/Commonwealth Fund Consumerism in Health Care Survey, 2006: Early Experience with High-Deductible and Consumer-Driven Health Plans, Issue Brief 300 (Washington: Employee Benefit Research Institute, December 2006), p. 27.
  6. Jack Hadley, “Sicker and Poorer—The Consequences of Being Uninsured: A Review of the Research on the Relationship between Health Insurance, Medical Care Use, Health, Work, and Income,” Medical Care Research and Review 60, no. 2 (June 2003): 3S–75S.
  7. Pamela Loprest, “Who Returns to Welfare?” Assessing the New Federalism, no. B-49 (Washington: Urban Institute, September 2002), p. 5.
  8. U.S. Census Bureau, “Historical Income Tables—Families,” f08ar.html (accessed March 20, 2007).
  9. Kaiser Family Foundation and Health Research Educational Trust, Employer Health Benefits 2005 Annual Survey (Menlo Park, Calif., September 2005), p. 61.
  10. Cathy Schoen and others, “Insured but Not Protected: How Many Adults Are Underinsured?” Health Affairs web exclusive (June 14, 2005) (accessed February 28, 2007). The authors define underinsurance to include one or more of the following: (1) medical expenses of 10 percent or more of income; (2) among low-income adults (those with incomes below 200 percent of the federal poverty level), medical expenses of 5 percent or more of income; (3) health plan deductibles equal to or exceeding 5 percent of income.
  11. Ibid.
  12. Committee on the Consequences of Uninsurance, Coverage Matters (see note 2).
  13. Based on National Association of State Budget Officers, State Health Expenditure Report 1998–1999 and 2002–2003, (accessed February 22, 2007).
  14. Based on Congressional Budget Office, Historical Budget Data, (accessed February 22, 2007).
  15. Joseph R. Antos and Alice M. Rivlin, “Rising Health Care Spending—Federal and National,” in Restoring Fiscal Sanity 2007: The Health Spending Challenge, edited by Antos and Rivlin (Brookings, 2007).
  16. Kaiser Commission, Health Insurance Coverage in America (see note 1), p. 1.
  17. States can and do regulate the types of products insurance companies can sell. When an employer purchases coverage from an insurance company it is subject to these regulations. Larger firms generally self-insure (bear their own financial risk). Since they are not purchasing a regulated product, they are not subject to the terms a state may establish for insurance policies.
  18. Since 1975, Hawaii has had in place an “employer mandate” that all firms provide coverage to their employees (but not the employees’ dependents). Congress provided Hawaii with explicit permission to adopt this policy, but it is not available to any other state.
  19. U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplement, 2006, (accessed February 22, 2007).
  20. Ibid.
  21. Ibid.
  22. Kaiser and HRET, Employer Health Benefits 2005 Annual Survey (see note 9), p. 35.
  23. Ibid., exhibit 3.1.
  24. John Sheils and Randall Haught, “The Cost of Tax-Exempt Health Benefits in 2004,” Health Affairs web exclusive (February 25, 2004), (accessed March 2, 2007).
  25. Kaiser Family Foundation,, (accessed March 20, 2007). Note that this point-in-time measure differs from a count of people who were ever enrolled in a program in a year.
  26. In some instances a family may face three or more different eligibility levels. Children’s eligibility levels often vary by age, so that two children may be in separate programs (one in Medicaid, one in SCHIP) or one may be covered and the other uninsured, while the parents face yet another eligibility threshold.
  27. For one compilation of ten such proposals, see Jack A. Meyer and Elliot K. Wicks, eds., Covering America: Real Remedies for the Uninsured (Washington: Economic and Social Research Institute, June 2001).
  28. Kaiser and HRET, Employer Health Benefits 2005 Annual Survey (see note 9).
  29. Census Bureau, “Historical Income Tables–Families” (see note 8).
  30. Gregory Acs and others, “Does Work Pay? An Analysis of the Work Incentives under TANF,” Assessing the New Federalism, Occasional Paper 9 (Washington: Urban Institute, 1998).
  31. A discussion of this trade-off appears in Linda J. Blumberg, “Balancing Efficiency and Equity in the Design of Coverage Expansions for Children,” Future of Children 13, no. 1 (Spring 2003).
  32. Derived from Kaiser Commission on Medicaid and the Uninsured, The Uninsured: A Primer (Washington: Kaiser Commission, October 2006), table 4, 31.
  33. Jonathan Gruber and Kosali Simon, “Crowd-Out Ten Years Later: Have Recent Public Insurance Expansions Crowded Out Private Health Insurance?” Working Paper 12858 (Cambridge, Mass.: National Bureau of Economic Research, January 2007).
  34. Kaiser Family Foundation, “Income Eligibility for Parents Applying for Medicaid by Annual Income as a Percent of Federal Poverty Level (FPL), 2006,”
  35. Steve Holt, “The Earned Income Tax Credit at 30: What We Know,” Research Brief (Metropolitan Policy Program, Brookings, February 2006).
  36. For a good description of the Massachusetts reform, see John E. McDonough, “The Third Wave of Massachusetts Health Care Access Reform,” Health Affairs web exclusive 25, no. 6 (September 14, 2006) http://
  37. Rick Curtis and Ed Neuschler, “Insurance Markets: What Health Insurance Pools Can and Can’t Do,” Issue Brief (Oakland, Calif.: California HealthCare Foundation, November 2005).
  38. Alan Weil, “Implementing Tax Credits for Affordable Health Insurance Coverage” (Boston: Blue Cross/ Blue Shield of Massachusetts Foundation, October 2005); and Lynn Etheredge and others, “Administering a Medicaid + Tax Credits Initiative” (Washington: Health Insurance Reform Project, February 2007).
  39. U.S. General Accounting Office, “Earned Income Tax Credit: Advance Payment Option Is not Widely Known or Understood by the Public,” GAO/GGD-92-26 (February 1992); U.S. Department of the Treasury, “Taxpayers Were Assessed Additional Tax for Advance Earned Income Credit Payments not Received,” Memorandum for Commissioner, Wage and Investment Division, 2003-40-126 (June 2003).
  40. Tax filing units, insurance units, coverage categories for public programs, and families all take different forms that are sometimes aligned but often not. How to handle the differences between these concepts requires more attention than it is given in this paper. Some discussion of this topic appears in Weil, “Implementing Tax Credits for Affordable Health Insurance Coverage” (see note 38). For the sake of simplicity, this paper uses the term family for all of these categories.
  41. Kaiser and HRET, Employer Health Benefits 2005 Annual Survey (see note 9).
  42. Ibid.
  43. Ibid.
  44. Most firms have a heterogeneous mix of salaries and family circumstances among their employees. IRS rules prohibit discrimination across employees on benefits, so a change in employer contributions could not be focused exclusively on the subset of employees who would obtain a tax credit. In addition, compensation provided in the form of benefits receives certain advantages in the tax code. Still, if the financial incentives are strong, some nontrivial number of firms can be expected to change their behavior.
  45. John Holahan and Alan Weil, “Toward Real Medicaid Reform,” Health Affairs web exclusive 26, no. 2 (February 23, 2007),
  46. John Sheils, Paul Hogan, and Randall Haught, “Health Insurance and Taxes: The Impact of Proposed Changes in Current Federal Policy” (Washington: Lewin Group, October 18, 1999), rdonlyres/BD11A6A0-1A58-4E87-94F5-C66A3CAFE50F/0/NCHC_Tax_Credit_Paper.pdf.
  47. Congressional Budget Office, Budget Options (February 2007), p. 158.
  48. Federation of American Hospitals, “Health Coverage Passport,” %20Designed%202-16-07.pdf (accessed March 20, 2007).
  49. The average annual health insurance premium for family coverage varied by a factor of 1.22 between the highest and lowest among the ten largest states in 2004. However, most states were clustered quite close to the national mean. James M. Branscome, “State Differences in the Cost of Job-Related Health Insurance, 2004,” Statistical Brief 135 (Agency for Healthcare Research and Quality, Medical Expenditure Panel Survey, July 2006).