Key Elements of the U.S. Tax System

In 2017, 57 percent of the nonelderly population obtained health insurance coverage through employment (figure 1). Another 8 percent purchased coverage on their own in the private market, while about 22 percent were covered by Medicaid and 3 percent had coverage from other public sources. That left 10 percent uninsured. Virtually all elderly individuals participate in Medicare, and those with low incomes also receive assistance through Medicaid.

Health insurance coverage rises sharply with income. Less than 19 percent of the nonelderly with family incomes below 100 percent of the federal poverty level had private coverage in 2017; 17 percent reported having no health insurance, public or private. In contrast, 88 percent of those with incomes above 400 percent of the federal poverty level had private coverage, and just 5 per-cent had no insurance.

The 2017 Tax Cuts and Jobs Act repealed the Affordable Care Act’s excise tax on individuals without adequate health insurance starting in 2019. The Congressional Budget Office projects the share of nonelderly adults without health insurance will increase from 11 percent in 2019 to 13 percent by 2029 mostly due to the repeal of the individual mandate.