There has been a lot of buzz about President Joe Bidenthe health care program and what proposals it will make a priority. But hardly anyone talks publicly about an idea that could do a lot of good: getting health insurance for low-income people who are part of what is now known as the “Medicaid gap”.
There are approximately 4 million of these Americans, it is estimated – many of them are restaurant waiters or retail clerks, child care workers, or, in some cases, the unemployed. And TThey were supposed to already have health insurance, thanks to the Affordable Care Act, which gave states additional funding to cover them through Medicaid.
But it hasn’t worked out like this for about a dozen states, all the places where Republican officials refused to take federal money. These states still have their old Medicaid eligibility guidelines, which limit enrollment to smaller groups of the population.
With little reason to believe GOP officials in those states will change their mind, it’s up to Democrats in Washington to find an alternative – a way to insure those 4 million people through some sort of new federal initiative.
Some proposals are already under discussion. And Biden seems interested. He spoke about bridging the Medicaid divide during the presidential campaign. On a conference call Tuesday, giving an overview of his new economic agenda and his speech to Congress, a senior administration official hinted at “extending coverage to places across the country that have blanket”.
But in Tuesday’s speech itself, Biden did not include any such reference. And although Capitol Hill Democrats have agitated on behalf of other healthcare proposals, like adding Medicare benefits or permanently implementing other temporary improvements to the Affordable Care Act, none does make a public agitation over policies to bridge the Medicaid divide.
It could be a problem. No one in the Democratic Party seems to be against tackling the Medicaid divide. But workable policy solutions are expensive, with complex policies, meaning they won’t find their place in legislation without a few vocal champions.
Medicaid was supposed to be the easy part of Obamacare
Covering all low-income Americans was supposed to be the easy and uncontroversial part of the Affordable Care Act. Instead of creating a new program from scratch, the architects of the law turned to Medicaid, a familiar, decades-old program whose states operate under federal guidelines and with partial federal funding.
Under the arrangement put in place by the Affordable Care Act, all states would open their Medicaid programs to anyone with an income up to 133% of the federal poverty line, or about $ 29,000 for a family of three people in today’s dollars. In return, the federal government would bear almost all of the cost of new registrants, leaving the states to manage only a small portion.
States that refused to expand eligibility would lose all of their federal Medicaid funding, including the money paying for the populations and services they already covered – a devastating outcome no state official would want.
Then came the 2012 Supreme Court ruling on the Affordable Care Act, which declared this threat to existing Medicaid funds unconstitutional. Republican state officials, determined not to touch anything on “Obamacare,” took advantage of the new leeway and rejected expansion into virtually every possible state, effectively limiting the expansion to a small group of people. States under democratic control.
Resistance to the expansion did not last everywhere, and over time a number of Republican-leaning states followed their Democratic-leaning counterparts – in places like Arizona and Ohio, because the GOP governors decided that federal money was a good deal for their constituents. and businesses; in places like Idaho and Nebraska, because voters took matters into their own hands and approved the expansion through some sort of voting initiative.
But in the remaining states, which include Florida and Texas, GOP officials seem unlikely to budge. The COVID-19 relief package has offered these states additional money, making the expansion of Medicaid even more financially attractive than before. Yet the only state where this seduction even stirred GOP officials was Wyoming, where lawmakers passed a bill to expand Medicaid only to reject it days later.
Bringing Medicaid to the low income population of these states would have a huge impact. The expansion of Medicaid is the part of the Affordable Care Act that has received the most rigorous and sustained attention from researchers, and there is now a long list of published articles showing that it is “Improved health outcomes and increased financial security for millions of people,” Judith Solomon, senior researcher at the Center on Budget and Policy Priorities, told HuffPost.
Larry Levitt, executive vice president of the Henry J. Kaiser Family Foundation, said he believed that “unless universal coverage is achieved, covering people in the Medicaid gap is probably the single most important step possible in reducing number of uninsured persons. And they are the most vulnerable among those who are still uninsured. “
Closing the Medicaid gap is doable, but complex
As a presidential candidate, Biden’s plan to help people in the Medicaid divide was to automatically enroll them in a new “public option,” a government-run insurance plan that Democrats would create through legislation. The public option was going to be open to everyone, regardless of income, but for people outside of Medicaid it would be free, with no copay or deductible, just like Medicaid itself.
It was one of the most innovative policy ideas Biden put forward during the campaign, winning praise from advocates for health care and liberal publications like American Prospect. While neither the administration nor the Democratic leadership is currently focusing on a large public option, there is serious discussion about creating some sort of scaled-down version – basically, a new program that looks like Medicaid – that doesn’t. would be open only to low-income people. people living in states without expansion.
Another option under discussion is to allow these people to purchase heavily subsidized private insurance plans through HealthCare.gov, which they cannot do now because the law makes these plans available only to people with incomes are above the poverty line. (Remember, the architects of the law assumed that people with incomes below the poverty line would receive Medicaid.)
Either political approach would involve its own set of compromises and complications. Creating a new public option, even one targeting the Medicaid divide, would require the creation of a whole new administrative apparatus. Opening subsidized plans on HealthCare.gov would be easier, but it would cost more per person.
And with either option, lawmakers would face another challenge: how to deal with states that have already expanded Medicaid.
Especially in more conservative states where officials have never been so enthusiastic about Medicaid, it’s easy to imagine them abandoning their plans and handing it over to the federal government. Depending on the design of the program, this could mean that people currently on Medicaid will switch to private insurance plans that many advocates believe offer vulnerable Americans less and less reliable coverage.
The way to solve this problem in the short term is to tinker with financial incentives by rewarding states for continuing to fund expansion on their own or by punishing those who let it go. There are different ways of doing this, but each of them would require additional spending, inflating the cost by tens and possibly hundreds of billions of dollars over 10 years, according to the details of the program.
Geography that makes finances more difficult also complicates politics, especially in the Senate, where 47 of the 50 Democratic caucus members come from states that have already expanded Medicaid. While these lawmakers may support expansion on a general principle, they are unlikely to promote it ahead of other ideas that would directly benefit some of their constituents.
Of course, some Democratic lawmakers have a vested interest in the matter, starting with the two newly elected senators from Georgia, who not only gave Democrats their majority, but also campaigned on the need to expand Medicaid in their state. . The House has many members from non-expanding states, clustered in places like Houston, South Florida, and other Democratic-leaning parts of GOP-led states. President Nancy Pelosi (D-California) also treated the Medicaid divide as a top priority.
Still, the champion who could make the biggest difference is Biden. If it visibly approves the idea, Congress is much more likely to pursue it. If it remains silent, Congress is more likely to postpone action. And anyone can guess how soon the next opportunity to pass this kind of legislation will present itself.
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