By Ruth Mantell
WASHINGTON (MarketWatch) -- Even as the number of Americans living in poverty rose last year, fewer Americans overall went without health insurance and there was an increase in the median household income adjusted for inflation, the Census Bureau reported Tuesday. The number of people without health-insurance coverage fell to 45.7 million in 2007 from 47 million in 2006, the government said in its annual snapshot. The number of uninsured children also declined, slipping to 8.1 million from 8.7 million. Median household income, adjusted for inflation, rose 1.3% to $50,233 -- the highest level since 2000. Income includes items such as earnings, interest, alimony and unemployment compensation. For households at the 20th percentile, income fell 1.5% to $20,291. For households at the 80th percentile, income rose less than a percentage point to $100,000.
Meanwhile, following three years of annual declines in real earnings, both men and women experienced gains in 2007. The real median earnings for men working full-time and on a year-round basis rose 3.8% to $45,113, with women's earnings growing by 5% to $35,102. The poverty rate hit 12.5% in 2007, compared with 12.3% in the prior year -- not statistically different, according to the Census Bureau. The poverty rate reached 11.7% in 2001, when the economy was in a recession. The number of Americans living under the poverty line reached 37.3 million, including 13.3 million children. In the prior year, there were 36.5 million under the poverty line, 12.8 million of whom were children.
Cause for concern
Despite some good news in the data, there is also cause for concern, according to the Center on Budget and Policy Priorities, a policy and research organization that specializes in programs that affect low- and moderate-income families and individuals. In particular, the rate of those without health insurance hit 15.3% in 2007, up from 14.1% in 2001. "The data for 2007 are of particular concern given that the economy is now in a slowdown, and poverty is almost certainly higher now -- and incomes lower -- than in 2007," said Robert Greenstein, CBPP's executive director.
"The 2007 levels -- already disappointing because they are worse than those for the 2001 recession -- are likely to constitute a high-water mark for the next few years. This suggests that significant pain may lie ahead for many Americans," he commented in a statement. Dr. Nancy Nielsen, president of the American Medical Association, said in a statement that many patients are priced out of coverage, and that covering all Americans would be a "good first step."
"We advocate for a shift in tax incentives for health insurance so lower-income Americans get money to purchase coverage," she added. "We also want insurance-market reforms to provide individuals more choices and ensure coverage for high-risk patients." CBPP estimates that the absolute number of Americans and the percentage of the overall population who are uninsured can be expected to increase both this year and next. "The numbers of uninsured parents and children are likely to grow as employers lay off more workers and states consider cuts in their Medicaid programs to help balance their budgets during the economic slowdown," Greenstein said.