Poverty Rate Continues To Climb

Michael F. Cannon, director of health policy studies at the libertarian Cato Institute, said more people are choosing Medicaid because it is a better deal than private coverage. "Medicaid has been expanded so much it includes a lot of people who could afford private coverage," he said.

But independent research suggests fewer companies are offering health insurance, Rowland said. "If Medicaid had not been offsetting some losses in the employer-based coverage, you would be seeing potentially another 1 million or 1.5 million more uninsured," she said.

In recent years, a growing chorus of economists and politicians have questioned the veracity of the poverty rates, median income level and number of uninsured. The Census Bureau's own alternative measurements of poverty -- which consider regional differences in cost of living, out-of-pocket medical expenses and more sophisticated inflation measures -- have consistently indicated that the official poverty level understates the problem. Conservatives object that the numbers do not capture assistance from food stamps, government insurance programs, housing aid or the earned-income tax credit.

The poverty data "are fundamentally flawed in measuring whether people are actually in some impoverished state of being," said Steven J. Davis, an economist at the University of Chicago's Graduate School of Business.

Charles Nelson, the Census Bureau's assistant division chief for income, poverty and health statistics, said the annual report does accurately capture the trends in poverty, income and insurance rates.

Locally, the picture was brighter. At $57,424, Maryland's median household income was above the national median, as was Virginia's, at $51,689, and the District's, at $46,574. With a median household income of $88,133, Fairfax County was the richest county in the nation in 2004. Of the five most affluent counties, three were in the Washington area -- Montgomery County was the fourth richest, with a median household income of $82,971; Howard County was just behind, with a median household income of $82,065.

Anderson said the new poverty numbers, while disappointing, were expected.

Poverty rates peaked years after the end of the recessions in the early 1980s and 1990s as well, she said.

"We're not happy about it, but going forward the trends are going the way we want them to go," she said.