What do we expect to see in the 2022 Census poverty, income, and health insurance data?
By Priya Pandey
On September 12, the Census Bureau will release poverty, income, and health insurance data for 2022. We expect to see a rise in the child poverty rate and the overall poverty rate because of the expiration of the expanded Child Tax Credit (CTC). The 2021 data showed a historic drop in child poverty rates, largely driven by an expanded and fully refundable CTC. Because the CTC was allowed to expire in 2022, we anticipate a reversal of these gains.
At the same time, other COVID-19 relief programs, including the Medicaid continuous coverage provision and, in certain states, SNAP emergency allotments, were still in place in 2022. Because the Medicaid provision provided millions of additional people with health insurance coverage in 2022, we anticipate that the data will show record low rates of uninsurance.
Here are three trends we anticipate:
1. An uptick in child poverty
The most dramatic change in the 2022 data is likely to be the sharp increase in child poverty, as measured by the Supplemental Poverty Measure (SPM) reflecting the end of the expanded CTC payments from the American Rescue Plan. (Although when families filed their tax returns, the Census attributed the full value of the credit to 2021 income.)
Following the end of monthly expanded CTC payments, many parents reported increased difficulties affording essentials like food and bills and greater financial stress. In a nationally representative survey, 60 percent of parents who previously received these payments said that their family’s financial situation had worsened since the payments ceased. Approximately two-thirds of respondents faced challenges covering necessities such as food and bills. Other expenses, such as clothing, shoes, rent, or mortgage payments also became harder to manage after the monthly payments stopped.
The expanded CTC achieved something extraordinary: it kept 2.9 million children from poverty, reducing the child poverty rate by nearly half in 2021. This unprecedented decline in child poverty can be attributed in part to the nature of the 2021 version, which allowed families with minimal or no earnings to claim the credit. Black and Latino/Hispanic children particularly benefited since their families and communities have disproportionately had lower incomes because they face greater structural challenges in the labor market.
Because of the expiration of the fully refundable CTC, we expect higher rates of poverty among Black and Latino/Hispanic children. Poverty among children in immigrant and mixed-status families is likely to be higher as well. Many children in these families were ineligible to receive the expanded CTC because the 2017 Tax Cut and Jobs Act specifically excluded children with Individual Taxpayer Identification Numbers (ITINs) rather than Social Security numbers. Restoring the CTC to families with children who have ITINs would benefit 1 million children.
2. The overall poverty rate is higher
The ending of the enhanced CTC is also likely to show up as an increase in overall poverty rates, as measured by the SPM. In addition to the CTC, lawmakers responded to the pandemic with key investments in stimulus payments, pandemic unemployment benefits, and expanded SNAP benefits, among others. With the termination of many of these measures, and despite continued job growth in 2022 and 2023, we are likely to witness a reversal of these gains, at least as measured by the SPM.
It is not as clear what will happen with the Census Bureau’s official poverty measure, which does not capture taxes and in-kind transfers. Job growth was strong in 2022 as businesses recovered from the pandemic. However, across the nation, people also grappled with record-high inflation, which disproportionately affected seniors, immigrants, Black and Hispanic households, and families with low or fixed incomes. We will be looking closely at the poverty numbers when they are released to see how these groups were affected.
3. Continuation of Low Uninsurance Rates
From March 18, 2020, until March 31, 2023, people enrolled in Medicaid had uninterrupted coverage, thanks to the continuous coverage provision that was part of the federal COVID-19 response. An increase in tax subsidies also made purchasing insurance on the Affordable Care Act marketplace more affordable for people. Consequently, uninsurance rates hit historic lows. Enrollment in Medicaid drove down the uninsurance rate, particularly in states that have not expanded Medicaid. Because the continuous coverage requirement was still in place through 2022, we expect that the Census data will show record low rates of uninsurance, consistent with other data sources.
However, the 2022 data likely represents a high-water mark. That’s because, starting on April 1, 2023, some states resumed disenrolling Medicaid recipients, leaving millions without coverage. Data from 33 states and the District of Columbia indicate that at least 5,934,000 Medicaid enrollees have been disenrolled since April 1. Three-quarters were procedural disenrollments. Recipients were terminated because they didn’t file the necessary paperwork. Projections suggested that up to 15 million people may lose coverage during the unwinding process.
Unfortunately, the data does not provide a breakdown by race, ethnicity, eligibility category, or age, as not all states are required to submit this information to the Centers for Medicare & Medicaid Services. Nonetheless, it is known that administrative hurdles in the renewal process can exacerbate inequities. The Department of Health and Human Services has projected more people are likely to be disenrolled during the unwinding process, despite their eligibility. Additionally, immigrants, people with limited English proficiency, people with disabilities, and older adults face barriers to Medicaid renewal and are at increased risk of losing Medicaid coverage. Children are also disproportionately affected, with over 5 million potentially losing coverage. Analyses suggest that Latino/Hispanic children may face greater barriers to Medicaid renewal. A recent study showed that immigrant families do not enroll in safety net programs, including Medicaid, due to fears about potential immigration consequences, evidence of a continued chilling effect from proposed Trump-era public charge rules.
The government’s response to the pandemic made significant strides in lifting people out of poverty and stabilizing households, positioning the nation on the path to economic recovery. Moving forward, it is imperative to bolster existing programs and expand public investments to address unmet needs and reach all disadvantaged populations, promoting economic security and fortifying the overall economy. The pandemic response and its resulting benefits proved that poverty in the United States is not an inevitability—it is a policy choice. While poverty impacts families and communities across all racial backgrounds, it is rooted in deeply entrenched, racially biased systems that have perpetuated the socioeconomic disparities experienced by generations, particularly people of color.