Louisiana Limps After Nation in Health Insurance Coverage

May 1, 1997

Judith Zwolak

A Tulane study found that the number of Louisiana residents with health insurance is far below the national average, and the situation is worsening. According to the study by Tulane's Institute for Health Services Research, more than a quarter of the workers in Louisiana have no health insurance and fewer than half of the private-sector workers in Louisiana get their insurance from their employers.

"The percentage of people without health insurance in Louisiana is incredibly high, certainly higher than you would see nationally," says Kenneth Thorpe, director of the institute and professor of health systems management. Compared to the 25 percent of working Louisianans without health insurance, 18 percent of workers nationally are uninsured. Nationally, 55 percent of workers are insured through their employers, while only 46 percent of workers in Louisiana have employer-sponsored health insurance.

The Institute for Health Services Research, part of the Department of Health Systems Management in the School of Public Health and Tropical Medicine, analyzed data from the U.S. Census Bureau for 1994 and 1995 and compared insurance coverage in Louisiana to other Southern states and to the nation as a whole. "What surprised me the most was, first, the large number of uninsured people who work, and, second, the fact that only about 45 percent of workers actually get insurance in their own name through their employer," Thorpe says.

The number of working uninsured in Louisiana is consistently higher than the national average in businesses of all sizes. "About 38 percent of workers in Louisiana in very small firms with under 10 employees are uninsured, and it's closer to 30 percent nationally," Thorpe says. "And there is a persistent difference across firm size. For example, if you look at the biggest firms, with over 1,000 employees, only 10 percent of the workers nationally are uninsured. Here in Louisiana, it's about 18 percent."

Compared to other Southern states, only Texas has a higher overall rate of uninsured residents (24.5 percent) than Louisiana (20.5 percent). Mississippi has a rate similar to Louisiana's at 19.7 percent; Alabama's is the lowest at 13.5 percent. One of the greatest disparities between Louisiana and the nation was the percentage of uninsured self-employed individuals, such as farmers and small-business owners.

Nationally, 25 percent of self-employed workers are uninsured compared to 65 percent in Louisiana. Also, only 4.2 percent of agricultural workers in the state had health insurance and virtually no workers in the fishing and forestry industries surveyed by the census had health insurance. Louisiana's health insurance problems may be worsening, Thorpe says.

Between 1994 and 1995, the number of uninsured rose from 839,000 to 885,000--a 1.2 percent increase in people without health insurance. Thorpe says the lack of health insurance drives healthcare prices up for everyone. "There are just fewer employers in the state that offer coverage," he says. "Ironically, Louisiana, despite being a relatively low-income and relatively poor state, is a very expensive healthcare state. The Medicaid spending per person is among the highest in the country and the cost of private insurance is quite high. It's a question of affordability."

As with automobile insurance, people who have health insurance are paying high premiums to cover those without insurance, Thorpe says. "If you have a lot of uninsured people getting care outside of the Charity system, then healthcare providers have to find a way to pay for that somehow," he says. "And they end up charging people with insurance more."

With state and local pressures to slow growth and even cut Medicaid spending, coupled with market pressures to reduce healthcare costs in private systems, Louisiana residents without healthcare insurance face increasingly limited access to healthcare, Thorpe says. Louisiana could learn from other states that have tackled similar problems.

"Some states have reformed their Medicaid programs," he says. "By generating substantial savings in Medicaid--through managed care and other types of innovative ways of delivering services--states have used a portion of these savings to provide health insurance for a broader set of individuals."

Other solutions include working with private insurance companies to provide coverage to children, Thorpe says. "It's a sensible strategy because children are actually relatively inexpensive to cover, and that's certainly a population where we know that immunizations and getting them in to see healthcare providers makes a lot of sense," he says.

Institute researchers unveiled this study in late March and plan to share it with state healthcare policy makers. Says Thorpe, "Care of the uninsured is a major, major policy issue for the state."

Tulane University, New Orleans, LA 70118 504-865-5000