The most commonly cited estimates of the number of uninsured children -- those produced by the Census Bureau, the Congressional Budget Office (CBO), the U.S. General Accounting Office (GAO), the Employee Benefit Research Institute (EBRI), and The Urban Institute -- use the March CPS as their source. The CPS, which is the source of the official Government statistics on employment and unemployment, is a nationally representative monthly survey of approximately 57,000 households in the United States. The sample is based on the civilian noninstitutionalized population of the United States, which includes persons living in households and group quarters (for example, college dormitories and rooming houses), but does not include residents of institutions (for example, homes for the aged) and persons living abroad. As well as being nationally representative, the sample is also representative of each of the 50 states and the District of Columbia, although for most states the samples are too small for precise state-level estimates.
The main purpose of the survey is to collect, by means of personal interviews, information on the employment status of the population during the survey month. In addition, supplemental questions are regularly added to the core questionnaire on topics such as health, education, income, and previous work experience. The March CPS contains supplemental questions on the health insurance status of each person in the household in the prior calendar year. Specifically, respondents are asked whether they had any of various types of private or public health insurance in the previous year. Respondents are permitted to report more than one type of health insurance coverage, although it is impossible to tell from the data whether persons with multiple types of coverage had the coverage concurrently or at different times during the previous year. The health insurance portion of the March 1995 CPS questionnaire is presented in Appendix A.
Respondents are never asked directly whether they were uninsured in the previous year. Instead, estimates of the uninsured are calculated as a residual -- that is, the uninsured are all those who do not report having some type of coverage in the previous year. As a result, the uninsured are those without any coverage throughout the previous year. However, some researchers believe that the CPS estimates of the uninsured are too high and, thus, that respondents may be reporting their health insurance status as of the interview date. This and other issues pertaining to estimates of the uninsured according to the CPS are discussed below.
The two principal classes of estimates of the uninsured using the CPS are (1) those done by the Census Bureau, CBO, GAO, and EBRI; and (2) those done by The Urban Institute. These estimates are summarized in Table II.1. The Urban Institute's estimates of the uninsured differ from the other estimates because they adjust for the underreporting of Medicaid in the CPS.
1. Census Bureau, CBO, GAO, and EBRI Estimates
Beginning with the March 1995 CPS, when the health insurance questions were revised to eliminate the possibility of respondent inconsistencies, the Census Bureau (Bennefield 1996a), CBO
CPS ESTIMATES OF THE UNINSURED BY SOURCE
|Census Bureau, EBRI, CBO, and GAO, and others
||Uninsured throughout 1995 (or point-estimate, depending on interpretation of CPS definition of uninsured)
||Children age 17
|Children age 18
|Adults age 18-64
|Nonelderly age 0-64
||Uninsured throughout 1995 (or point-estimate, depending on interpretation of CPS definition of uninsured). Adjusted for the Medicaid undercount in the CPS using the TRIM2 model.
||Children age 17
|Children age 18
|Adults age 18-64
|Nonelderly age 0-64
(Bilheimer 1997), GAO (1997), and EBRI (Fronstin 1996) began publishing identical estimates of the number of uninsured.(1) Using the March 1996 CPS, they found the following:
- Children age 0 to 17: 9.8 million uninsured (13.8 percent of all children)
- Children age 0 to 18: 10.5 million uninsured (14.0 percent of all children)
- Adults age 18 to 64: 30.5 million uninsured (19.0 percent of all adults)
- All persons age 0 to 65: 40.3 million uninsured (17.4 percent of all persons)(2)
None of these organizations adjusted their estimates for the underreporting of Medicaid in the CPS.
2. The Urban Institute's Estimates
The Urban Institute's estimates of the uninsured differed from others because the Institute adjusted for the underreporting of Medicaid in the CPS. The Institute used its Transfer Income Model (TRIM2), a microsimulation model, to test for Medicaid eligibility among non-reporters of Medicaid and then selected individuals to participate so that the size of the resulting Medicaid population in the model matched Health Care Financing Administration (HCFA(now known as CMS)) administrative data according to age and disability status of all persons ever enrolled in Medicaid in a given year. Using the TRIM2 model with March 1996 CPS data, the Institute found the following:
- Children age 0 to 17: 6.9 million uninsured (9.8 percent of all children)
- Children age 0 to 18: 7.6 million uninsured (10.3 percent of all children)
- Adults age 18 to 64: 28.8 million uninsured (18.0 percent of the population)
- All persons age 0 to 65: 35.7 million uninsured (15.5 percent of all persons)
The estimate of 6.9 million uninsured children in 1995 is 30 percent lower than the CPS estimates that include no adjustment for the underreporting of Medicaid. In all, the Institute simulated 2.9 million children to participate in Medicaid who reported no health insurance coverage in the CPS.
Researchers debate whether the Institute's adjustment for the underreporting of Medicaid yields improved estimates of the uninsured. One potential problem is that the Institute's adjustment may overcompensate for the underreporting because the adjustment is based on administrative estimates of the number of persons ever enrolled in Medicaid during the year, while CPS estimates of the uninsured may reflect those uninsured at a point in time. Another potential problem is that although the Institute adjusts for Medicaid underreporting, it makes no adjustment to reported private employment coverage, which could be either over- or underreported. This is important because the uninsured are calculated as a residual and, therefore, accurate estimates of the uninsured require accurate estimates of coverage for all other types of insurance. Despite these potential problems, the fact remains that Medicaid is substantially underreported in the CPS and, therefore, will affect most estimates of the uninsured in one way or another. The issues of underreporting of Medicaid and whether the CPS estimates may reflect those enrolled at a point in time are described in more detail below.
3. CPS Health Insurance Measurement Issues
When interpreting estimates of the uninsured done by researchers using the CPS, it is important to understand that these estimates are affected by various measurement issues that specifically pertain to the CPS data. These issues include the following: the time-frame of the CPS measures of health insurance, Medicaid underreporting, and survey undercoverage of the population.