In theory, the Patient Protection and Affordable Care Act (PPACA) could eliminate the market for “gap filler” products, by using a combination of subsidy carrots and tax penalty sticks to push all people who can possibly afford major medical coverage to sign up for it.
In reality, millions of people went without major medical coverage in 2014 and, as of mid-February, were planning to stay bare this year.
Some of the survey participants were “persistently uninsured.”
For PPACA exchange managers and policymakers worried about people who lack PPACA-compliant major medical coverage, they’re headache.
For insurers and producers who want to sell the gap-filler products that have survived PPACA — and are clever enough and quiet enough not to trigger a regulatory crackdown — the McKinsey results may identify interesting groups of potential prospects.
To look at the types of potential prospects who might be present in the McKinsey survey report, read on.
1. People with a decent income.
In the McKinsey survey sample, only 40 percent of the persistently uninsured reported having income under 250 percent of the federal poverty level.
That means 60 percent had incomes over 250 percent of the federal poverty level.
Traditionally, insurers have liked insuring men, because men have a noticeable lack of ability to give birth. That holds down their claim costs.
McKinsey found that 61 percent of the persistently uninsured people in its sample were men.
See also: A new hole world
3. Healthy people
PPACA has given one big, involuntarily uninsured group of people, people with serious health problems, the ability to buy major medical coverage without worrying about the effects of their health problems on either access to coverage or the cost of coverage.
The result is that a high percentage of people who understand exactly why they need health coverage have bought it, and that the remaining uninsured people are in great physical shape.
McKinsey classified 75 percent of the persistently uninsured people as low-risk, based on their self-reported health status and answers they gave about their use of the health care system.