Preliminary census data for Wisconsin shows state’s poverty level lowest since before Great Recession

New Census data released in September contained mixed news relating to national trends in income, poverty and health insurance coverage across the United States.

The new data from the Current Population Survey (CPS) show that there were 38.1 million Americans in poverty in 2018. That’s an unacceptably large number, but there are a few positive findings in the new poverty and income data:

• The official poverty measure fell for the fourth straight year in 2018, dropping to 11.7% from 12.3% in 2017
• That change reflects 1.4 million fewer people in poverty last year, compared to 2017, and for the first time in 11 years the 2018 poverty rate was lower than it was in 2007 – the year before the last recession.
• Median household income remained statistically unchanged last year (at $63,179), but median earnings of all workers increased by 3.4% more than the inflation rate.

Although the trend lines in the poverty data are mostly positive, there are also lots of sobering numbers in the new Census data. In particular, poverty rates continue to be far higher for people of color. Because of past and present discrimination and structural barriers to equal opportunity, the poverty rate nationally was more than twice as high for Blacks (20.8%) and Hispanics (17.6%) compared to non-Hispanic white people (8.1%).

Another area of concern is a significant downturn in health insurance coverage, after the very large increase that occurred from 2011 through 2016. For example:

• According to the latest CPS data, the number of uninsured Americans climbed by about 1.9 million in 2018 to 27.5 million, or 8.5% of all Americans, compared to 7.9% in 2017.
• The American Community Survey (ACS) data show a smaller but still significant increase, and this is the first time during the last 10 years that both measures showed an increase in the number of people who don’t have health insurance.
• The largest decline in percentage point terms is in the number of people covered by Medicaid, which dropped from 18.0% in 2017 to 17.3% last year.
• The CPS data show that the number of uninsured children jumped by 425,000 in 2018, and the uninsured rate for children increased by 0.6 percentage points to 5.5%.

A variety of factors appear to be contributing to the drop in health insurance coverage. Job gains and a declining poverty rate may explain part of the drop in Medicaid coverage, but one would expect reduced Medicaid enrollment to be offset by increases in private coverage as employment and wages grow, and that was not the case last year. With those considerations in mind, a number of commentators have pointed to actions by the Trump administration to undermine the Affordable Care Act and to discourage lawfully present immigrants from participating in Medicaid and other public programs they are eligible for.

Joan Alker, executive director of the Center for Children and Families, said the Trump Administration’s actions “have made health coverage harder to access and have deterred families from enrolling their eligible children in Medicaid and CHIP.” She noted that the largest coverage losses include Latino children, non-Hispanic white children and children under age six. With that in mind, she stated:

“This is clear evidence that the Administration’s rhetoric targeting immigrant families is harming children, but that’s not the only cause. More red tape, less outreach, and general neglect are contributing to this rise in uninsured children.”

Policymakers in Wisconsin can reverse the negative trends by improving BadgerCare outreach, streamlining enrollment and renewal procedures, regulating junk insurance plans, and expanding BadgerCare to cover more low-wage workers (many of who cannot afford the cost-sharing in Marketplace plans).

The new Census Bureau data also show the need for a renewed federal commitment to enabling more people to escape poverty. One way to do that is to approve the Working Families Tax Relief Act, which is sponsored by Senator Baldwin and 45 other senators. It would raise the incomes of an estimated 46 million households by expanding the Earned Income Tax Credit and the Child Tax Credit.