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A Project of The Annenberg Public Policy Center

Insurance Coverage: Obama’s Air Ball

During an impromptu press conference with the White House press corps on Feb. 9, President Barack Obama claimed that more people are getting their health insurance this year from the government than through the private sector. But that’s not even close to being true. If this had been a basketball shot, it would have missed the backboard:

Obama, Feb. 9: I don’t know if people noted, because during the health care debate everybody was saying the president is trying to take over — a government takeover of health care. I don’t know if anybody noticed that for the first time this year you saw more people getting health care from government than you did from the private sector — not because of anything we did, but because more and more people are losing their health care from their employers.

It’s true that the number of people getting health insurance through the government is increasing. But there are still more people with private health insurance than government-sponsored insurance. A lot more.

According to figures released by the U.S. Census Bureau last year, the number of people with government health insurance climbed to more than 87 million in 2008. But they were still vastly outnumbered by those with private health insurance, whose numbers decreased slightly to 201 million. That’s still more than a 2 to 1 ratio of private health coverage to government-sponsored health coverage.

The president may have been thinking of a recent Centers for Medicare and Medicaid Services report printed in the Health Affairs journal. That report found that government spending on health care is on the rise as well. It said the government will eventually account for more than half of all dollars spent on health care even if current legislation is not approved. (Persons over 65 and on Medicare tend to spend far more than younger people covered by private insurance, for one thing, and their numbers are rising fast.) But the tipping point did not arrive "this year," as Obama claimed. The report predicted it would not occur until the year 2012.

CMS report, Health Affairs, Feb. 4: Private health spending growth in a given year has historically been affected by changes in disposable personal income, both in the current year and a few years earlier. The current recession, therefore, is expected to lead to continued low growth among private payers (averaging 3.9 percent) in 2011 and 2012. Public health care spending growth is projected to average 6.8 percent over that time. The net result is an expectation that public payers will pay for slightly over half of the health care purchased in the United States by 2012, compared to 47 percent in 2008.

Obama would have been correct to say that government health insurance is on pace to surpass private health insurance in the U.S. with or without any new legislation — but only as measured by the total number of dollars spent and not the number of people covered, and not for a few more years.