September 13, 2022
New Census Data Shows Federal and State Investments Shielded Many Families from Severe Hardship and Led to Drop in Virginia’s Supplemental Poverty Rate
New data released today from the U.S. Census Bureau’s Current Population Survey point to the critical impact that federal relief and major state policy choices had on the well-being of children and families in 2021.
Expansions of broad-based federal policies and programs like the child tax credit, unemployment insurance, Medicaid, and Affordable Care Act subsidies were particularly influential in shielding Virginia’s families from severe hardship and shortening the country’s economic crisis. Virginia lawmakers made similarly positive policy choices when they removed a number of barriers to health coverage through Medicaid, including connecting more people to health coverage by expanding Medicaid in 2018, and enacted a partially refundable earned income tax credit this June, though the impact of this choice will not be captured until a later time.
Summary of data released today:
- Health Insurance: The Current Population Survey data shows a drop in the national uninsured rate, which fell from 8.6% in 2020 to 8.3% in 2021. Public health coverage options have been a lifeline for families over these last few difficult years. Between 2020 and 2021, an additional 3.1 million people across the nation have gained health coverage through Medicaid, and the share of people who have a form of public health coverage has increased from 34.5% to 35.7%.
The gains in health coverage were most significant in 2021 for Black children and adults under age 65, with the uninsured rate decreasing by 1.6 percentage points for each age group. Meanwhile, Asian American children saw a significant 1.8 percentage point increase in uninsured rate. However, Latino/a/x and Black people in the United States continue to face substantial barriers to health coverage and therefore are still most likely to be uninsured.
Virginia data on health coverage will be released on Thursday from the American Community Survey.
- Poverty and household income: The Supplemental Poverty Measure shows the positive impact that federal COVID relief had for families.
Virginia’s supplemental poverty measure, which is a more comprehensive measure of family well-being than the official poverty measure, dropped to 8.6% for the three-year period of 2019-2022, down from 11.5% during the 2017-2019 period. This drop was greater than the decrease in the estimated official poverty rate using the same Current Population Survey release, showing the importance of COVID relief and other policy choices that are captured in the supplemental poverty measure but not the official poverty measure. The supplemental poverty measure includes in a family’s income the value of tax credits and non-cash benefits such as food assistance (SNAP), and also adjusts for geographic costs of living and expenses such as medical and child care costs.
While the national official poverty measure and real (inflation-adjusted) median household income are unchanged in 2021 compared to 2020 using the estimates released today from the Current Population Survey, the Supplemental Poverty Measure dropped to 7.8% for the U.S. as a whole, down 1.4 percentage points from 2020. This drop in the share of Americans who are living below the poverty rate was driven by federal policy choices, including the expanded Child Tax Credit.
During 2021, the Child Tax Credit lifted 5.3 million children and their families out of poverty. Although the improvements to the federal Child Tax Credit have expired, Virginia’s improvements to the state Earned Income Tax Credit (EITC) will help some Virginia families when 2022 tax refunds are issued this upcoming Spring 2023. Together, the EITC and Child Tax Credit make the tax code fairer, increase equity, and improve families’ economic security now and in the future. Virginia has the opportunity to create a state child tax credit and make further improvements to the state EITC to continue this progress.
Maintaining these improvements in poverty, income, and health coverage will require continued state and federal investments. This includes removing remaining barriers to health coverage and improving Virginia’s tax system to support struggling families while making sure the wealthy and well-connected pay their fair share.
Virginia data on health insurance, poverty rates, and median household income by race, geography, citizenship status, and other factors will be available from the Census Bureau’s American Community Survey on Thursday.