Obamacare: These 6 States Have the Lowest Uninsured Rates

There's a surprising reason for improvement in these states. Find out what it is.

Dan Caplinger
Dan Caplinger
Oct 11, 2015 at 7:39AM
Health Care

The Affordable Care Act has transformed the healthcare industry, with its provisions having led to massive changes in the way that millions of Americans get their healthcare needs met. Amid all the controversy surrounding the legislation, it's easy to forget that the stated purpose of Obamacare was to reduce the percentage of people lacking health insurance.

With Obamacare having been law for several years now, uninsured rates have indeed dropped dramatically, with Gallup recently reporting that the national rate has dropped from 17.3% at the end of 2013 to 11.7% earlier this year. Yet when you look more closely at the data, you'll find that beneath the national numbers, there's a wide gulf between the effectiveness of Obamacare in some states versus others. Let's take a look at the six states where uninsured rates are the lowest, with an aim toward figuring out why they've done a better job at covering previously uninsured citizens than other states.

Images courtesy U.S. Mint.

6. Iowa
Iowa has done an amazingly good job in making reductions to its uninsured rate, with the state having gone from 9.7% uninsured in late 2013 to just 5% this year. A big part of that decrease has come from increased enrollment in the states Medicaid and CHIP programs, which have grown by more than 100,000 participants during that 18-month span. After having initially enacted a version of Medicaid expansion that allowed the use of state funds to buy private health plans, Iowa recently said it would move to a more traditional Medicaid managed care plan model instead.

5. Connecticut
Connecticut has seen even more dramatic improvement in its uninsured rate over the past 18 months, going from 12.3% a year and a half ago to 5% currently. Figures that the state's Access Health CT program collected last year showed that roughly 80% of those residents that it enrolled qualified for state Medicaid coverage. Some state lawmakers argue that the figures don't reflect gains in privately provided insurance through employers, with too much reliance on public coverage like Medicaid.

4. Vermont
Vermont was already in particularly good shape as early as 2013 in getting its citizens insured, with an uninsured rate of just 8.9% a year and a half ago. Even so, the state has made even further progress, with the current rate down to 4.6%. A separate study from the Vermont state government found that improvements have come from across demographic lines, and the state now covers all but 1% of its children under age 18. The state highlighted Medicaid expansion as a key component of the improvement.

3. Minnesota
Minnesota has had an almost identical experience to Vermont, with its 9.5% uninsured rate in 2013 improving to 4.6% this year. State officials credited the MNsure exchange as playing a key role in boosting coverage, with more than 325,000 having gained coverage between November 2014 and last month. As in other states, more than three-quarters of those signing up qualified for public health insurance programs, with just 70,000 signing up for private plans.

2. Massachusetts
Thanks to moves that the Bay State made long before Obamacare became law, Massachusetts had by far the lowest uninsured rate in the nation at just 4.9%. Nevertheless, the state has continued to make headway and now boasts just 3% of its citizens lacking health insurance. Although the model developed in part by former Gov. Mitt Romney has required some modifications under Obamacare, it nevertheless supports the idea of requiring minimum levels of health insurance for all residents.

1. Rhode Island
Rhode Island's leadership in uninsured rates is especially impressive when you consider that at 13.3%, the Ocean State had the highest uninsured rate of any of the six states on this list in 2013. Nevertheless, the nation's smallest state now has the smallest percentage of its citizens lacking health insurance, weighing in at just 2.7%. Officials at the HealthSource RI exchange argue that they've done an even more effective job than the federal exchange at finding uninsured residents and getting them enrolled.

What do these states have in common?
All of these states expanded Medicaid eligibility as part of their strategy toward covering more of their residents. Yet the Affordable Care Act made this move optional rather than requiring all of the states to participate. Although the majority of states have followed suit, there are still more than a dozen holdouts that have chosen not to expand their Medicaid coverage, which has exacerbated disparities in different parts of the country.

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Obamacare supporters point to reductions in uninsured rates as proving the success of the Affordable Care Act, while opponents argue that greater reliance on public programs is unsustainable. Both sides will have to wait to see which view will prove correct in the long run.