Health Insurance: Rethinking Goals Amid Interrupted Progress


Times of crisis can bring clarity to fundamental problems. While we’ve witnessed the heroic actions of many health care providers and institutions, the COVID-19 pandemic has exposed the many vulnerabilities of our fragmented health care financing and delivery system. It has also highlighted the deeply embedded structural racism that has resulted in the wide disparities in COVID-19 health outcomes among Black and Brown communities. These disparities are not only the consequence of deep inequities in how we finance and deliver health care, but, importantly, also stem from inequities in broader social and economic factors. Yet even where we thought we were making progress, that progress was apparently tenuous at best.


Before the COVID-19 pandemic arrived, New York State had made significant progress over the past ten years in addressing the number of people without health insurance. The rate of the state’s population that was uninsured went from about 12 percent in 2010 to roughly 5 percent at the beginning of this year; this was largely due to the tools made available by the Affordable Care Act (ACA). Of course, for a state as populous as New York, a 5 percent uninsured rate still meant that over 1,000,000 New Yorkers were uninsured. Nevertheless, it marked meaningful improvement.

But the pandemic demonstrated just how fragile this progress was. Over half of all New Yorkers receive their health insurance through their employers (employer-sponsored insurance, or ESI). The massive loss of jobs, which hit communities of color the hardest, translated into loss of health insurance for many. Of course, as we have reported, there are many more affordable health insurance options now, compared to the last recession. Still, it’s a good bet that more than a few individuals and families will fall through the cracks.


At United Hospital Fund, we believe that all New Yorkers should have comprehensive health insurance coverage and access to needed health care services. We have always acknowledged that there are numerous paths to this goal. However, it is clear that the chosen path in this country—one based on a patchwork of financing strategies and insurance options—is one of the most fragile. In a nation as rich as ours, why should an economic shock that results in rising unemployment cause additional harm to the newly jobless by taking away their health insurance? It is fundamentally inequitable and inhumane.

New York State has certainly tried to make the best of the current situation. By aggressively expanding Medicaid, running a successful state-based insurance marketplace, and implementing the ACA’s Basic Health Program, our Essential Plan, the state has created a fairly robust safety net to catch many of those who fall from ESI.

However, not all coverage is equal. I believe that New York has one of the best Medicaid programs in the country, but as is the case across the rest of the nation, Medicaid payments to providers fall far short of ESI/commercial payments to providers. These payments, of course, get further cuts in times of budget crises. This has resulted in safety net providers—those that disproportionately serve patients with Medicaid and the uninsured (who are both disproportionately patients of color)—being severely under-resourced, compared to their peers that primarily serve patients with ESI/commercial insurance. At the peak of the COVID pandemic, it was the succession of news stories of overwhelmed safety net institutions that were seared into our nightmares. (As an aside, this is not to say that safety net hospitals deliver poorer quality of care). 

What can we do about this? A first step would be to modify how we think about our goal when it comes to health insurance coverage. Getting close to 100 percent insured is no longer enough—stability of coverage, particularly in times of economic stress, is important as well. But it’s also critically important to narrow the gap in access to high-quality care between Medicaid and private insurance coverage. Like many other goals, there are multiple strategies to accomplish this, with varying levels of disruption to how we currently finance and deliver health care. But let’s first agree that how we’re doing it right now is just not fair.

This commentary appears in the summer 2020 issue of UHF's Blueprint newsletter

Aug. 13, 2020
Focus Area
Coverage and Access
Health Insurance Project