They Don’t Qualify For Medicaid In Their States But Earn Too Little To Be Eligible For Subsidized Aca Health Plans It’s A Gap In Health Care Coverage And Some Politicians Are Trying To Fix It
There are more than 2 million people across the United States who have no option when it comes to health insurance. They’re in what’s known as the “coverage gap” they don’t qualify for Medicaid in their state, and make too little money to be eligible for subsidized health plans on the Affordable Care Act insurance exchanges.
Briana Wright is one of those people. She’s 27, lives near Jackson, Miss., works at McDonalds, and doesn’t have health insurance. So to figure out her options when she recently learned she needed to have surgery to remove her gallbladder, she called Health Help Mississippi, a nonprofit that helps people enroll in health insurances.
Because she lives in Mississippi, “I wasn’t going to be eligible for Medicaid because I don’t have children I’m not pregnant,” she tells NPR. When she had her income checked for Healthcare.gov, it was just shy of the federal poverty line the minimum to qualify for subsidies. “It was $74 . I was like, oh wow,” she says.
Today, there are 12 holdout states that have not expanded Medicaid, and Mississippi is one of them.
So, Wright is still uninsured. Her gallbladder is causing her pain, but she can’t afford the surgery without shuffling household bills, and risking leaving something else unpaid. “I’m stressed out about it. I don’t know what I’m going to do,” she says. “I’m going to just have to pay it out of pocket or get on some payment plan until it all gets paid for.”
Will The Deep South Ever Expand Medicaid Would It Matter
Scholars and pundits have predicted that every state ultimately would expand Medicaid, arguing that the opportunity to have the federal government pay 90%100% of the costs for insuring large numbers of people would be too good to pass up. To date, 37 states have taken the deal. However, a block of states in the Deep South continues to resist.
Southern states are home to an estimated 92% of the 2.5 million people who fall into the Medicaid coverage gappeople who would be eligible for coverage if their state were to expand Medicaid but who are too poor to qualify for subsidies on a health insurance exchange.1 Will these states ever expand Medicaid? What political factors would need to come together for this to happen?
This is an ideal time to ask these questions, as three southern states hold their gubernatorial and legislative elections in the off year between the national midterm and presidential elections. This November, incumbent governors are running for reelection in Kentucky and Louisianatwo Southern states that have expanded Medicaidand Mississippi will elect a new governor. Medicaid politics has played an important role in all three states in ways that illustrate four key points about the future of the program.
Medicaid Expansion Remains a Divisive Issue
The Path to Medicaid Expansion is Varied, but Narrow
Expansion or Retrenchment?
The Limits of the Program
References
Medicaid Expansion With A Ballot Initiative
In Maine, Utah, Idaho, Nebraska, Oklahoma, and Missouri, Medicaid expansion came about as a result of ballot measures passed by voters. And South Dakota will join that list in July 2023, when Medicaid expansion is slated to take effect under the terms of a ballot measure that voters approved in the 2022 election.
So far, Medicaid expansion ballot initiatives have passed in 100% of the states that have had them on the ballot .
Medicaid expansion advocates in Mississippi had been working to gather signatures for a 2022 ballot measure, but suspended their campaign after a Mississippi Supreme Court decision that currently makes it impossible for a signature-gathering campaign to be successful in the state.
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Which States Do Not Have Expanded Medicaid
Increases from pre-ARPA policy are shown for 12 states that have not extended Medicaid: Alabama, Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, South Dakota, Tennessee, Texas, Wisconsin, and Wyoming. Health Insurance Policy Simulation Model of the Urban Institute, 2021.
In addition to these 12 states, 21 other states would not extend coverage under their current programs: Alaska, Arizona, Colorado, Delaware, Hawaii, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington, West Virginia, and Wyoming.
It is important to note that although Medicaid eligibility standards are generally set at 130% of the federal poverty level, this report uses a more restrictive definition of expansion status. States that choose not to expand Medicaid under ARRA will be able to charge higher premiums or make other changes to their programs if they want to increase access to coverage for low-income individuals. However, if they choose not to do so, their residents will not be eligible for Medicaid benefits as defined by the program’s rules .
The Affordable Care Act provides federal funding to any state that chooses to implement an insurance exchange or expand its existing Medicaid program.
Option : Get Around Stubborn States By Letting Cities Expand Medicaid
Instead of centralizing the approach, this next idea goes even more local. The COVER Now Act, introduced by Rep. Lloyd Doggett, D-Texas, would empower local jurisdictions to expand Medicaid. So, if you live in Austin, Texas, maybe you could get Medicaid, even if someone in Lubbock still couldn’t.
The political and logistical challenges would be tough, policy analysts say. Logistically, such a plan would require counties and cities to create new infrastructure to run a Medicaid program, Rudowitz notes, and the federal government would have to oversee how well these new local programs complied with all of Medicaid’s rules.
“It does not seem feasible politically,” Michener says. “The legislators who would have to vote to make this possible would be ceding quite a bit of power to localities.” It also might amplify geographic equity concerns, she says. People’s access to health insurance would not just “be arbitrarily based on what state you live in which is the current state of affairs It’s also going to be arbitrary based on what county you live in, based on what city you live in.”
What’s next: Doggett introduced the bill earlier this month. There’s no guarantee it would get a vote on the House floor and even if it did it wouldn’t survive a likely filibuster in the evenly divided Senate.
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Waivers With Eligibility And Enrollment Restrictions: Approved And Pending As Of January 12 2022
In December 2021, CMS under the Biden Administration notified several states with approved Section 1115 premium requirements that it had decided that these requirements are not likely to promote the objectives of Medicaid. In approving demonstration extensions for states with previously approved and implemented premiums , CMS renewed these premiums for one year only to allow for a phase-out period CMS notified Georgia that it was withdrawing the states authority to charge premiums. Eligibility restrictions including premium requirements had been a key Section 1115 waiver priority under the Trump Administration.
Legislation To Expand Medicaid
Lawmakers in the states that havent expanded Medicaid have continued to introduce legislation each year in an effort to expand coverage. In 2018, Virginia lawmakers passed a budget that includes Medicaid expansion, with coverage that took effect in January 2019. By November 2022, nearly 700,000 people had gained coverage in Virginia under Medicaid expansion.
Georgia enacted legislation in 2019 that allowed the state to submit a Medicaid expansion proposal to CMS, but only for people earning up to 100% of the poverty level . As described above, CMS approved the partial expansion to take effect in mid-2021, but rejected the states request for full Medicaid expansion funding. And after the Biden administration revoked approval for Georgias planned work requirement, the state paused implementation of the partial Medicaid expansion.
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Other Medicaid Proposals To Watch
Several states have sought CMS approval to implement lifetime caps for Medicaid coverage, including Arizona, Kansas, Maine, Utah, and Wisconsin. But thus far, CMS has not approved this provision for any states. Arizonas work requirement approval noted that CMS was rejecting the states proposal to cap eligibility at five years for people who were subject to, but not in compliance with, the work requirement.
The Trump administration also rejected Arkansas proposal to cap Medicaid eligibility at 100% of the poverty level, instead of 138%. The agency also rejected a similar proposal from Utah in 2019, and from Georgia in 2020. Massachusetts submitted a similar request to CMS that was never approved, although Massachusetts has already expanded Medicaid.
And no states have received approval for an asset test for Medicaid. Maine proposed an asset test as part of an 1115 waiver proposal, but that portion of the waiver was not approved.
Several states have received approval, however, to impose premiums on certain Medicaid populations, restrict retroactive eligibility, and require more eligibility redeterminations.
Private option Medicaid
New Hampshire enacted legislation in 2018 that directed the state to abandon the private approach to Medicaid expansion that was being used in the state at the time and switch to a Medicaid managed care program instead. The state submitted a waiver amendment proposal to CMS in August 2018, and the transition took effect in 2019.
Medicaid buy-in
If Your Income Is Low And Your State Hasnt Expanded Medicaid
If your state hasnt expanded Medicaid, your income is below the federal poverty level, and you donât qualify for Medicaid under your stateâs current rules, you wont qualify for either health insurance savings program: Medicaid coverage or savings on a private health plan bought through the Marketplace.
- Find out why
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- When the health care law was passed, it required states to provide Medicaid coverage for all adults 18 to 65 with incomes up to 133% of the federal poverty level, regardless of their age, family status, or health.
- The law also provides premium tax credits for people with incomes between 100% and 400% of the federal poverty level to buy private insurance plans in the Health Insurance Marketplace®.
- The U.S. Supreme Court later ruled that the Medicaid expansion is voluntary with states. As a result, some states havent expanded their Medicaid programs.
- Adults in those states with incomes below 100% of the federal poverty level, and who dont qualify for Medicaid based on disability, age, or other factors, fall into a gap.
- Their incomes are too high to qualify for Medicaid in their states.
- Their incomes are below the range the law set for savings on a Marketplace insurance plan.
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States are continuing to make coverage decisions. They could expand Medicaid in the future.
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Did South Carolina Expand Medicaid
Because South Carolina hasn’t expanded Medicaid, the state’s Medicaid population consists of low-income people who are children, elderly, disabled, pregnant, or parents of minor children. Adults who don’t fit into one of these categories are not eligible for coverage, no matter how low their income is.
The Effects Of Earlier Medicaid Expansions: A Literature Review
The American Rescue Plan of 2021 temporarily increased the federal government contribution for Medicaid expansion to the 13 states that have not yet expanded Medicaid coverage to all low-income adults. Since the Affordable Care Act expansion of Medicaid in 2014, there have been numerous studies that looked at its impact. These studies find first order effects including increased insurance coverage and improvements in health with no negative impact on state budgets. They also find second order, or indirect, effects such as gains in food security, housing security, financial wellbeing, and child support. These important effects have all come with little impact on state budgets as federal funding and decreases in state spending on uncompensated care, among other things, tend to cover the increased costs associated with expansion.
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States Refuse To Expand Medicaid It Hurts Us All
In 2020, Missouri residents voted to expand Medicaid, the federal health insurance program for the poor. Under the terms of the 2010 Affordable Care Act, the federal government contributes more generous funding to states that offer expanded access to the program to their residents. In Missouri, expansion would have meant an estimated 275,000 more people would have become eligible.
But in the spring, Missouris legislature refused to include funds for the expansion in the state budget, and in May, Gov. Mike Parsons.
How Many Uninsured People Who Could Have Been Eligible For Medicaid Are In The Coverage Gap
Nationally, more than two million3 poor uninsured adults fell into the coverage gap that results from state decisions not to expand Medicaid , meaning their income was above Medicaid eligibility but below the lower limit for Marketplace premium tax credits. These individuals would be eligible for Medicaid had their state chosen to expand coverage. Reflecting limits on Medicaid eligibility outside ACA pathways, most people in the coverage gap are adults without dependent children.4
Adults left in the coverage gap are spread across the states not expanding their Medicaid programs but are concentrated in states with the largest uninsured populations. More than a third of people in the coverage gap reside in Texas, which has both a large uninsured population and very limited Medicaid eligibility . Nineteen percent of people in the coverage gap live in Florida, twelve percent in Georgia, and ten percent in North Carolina. There are no uninsured adults in the coverage gap in Wisconsin because the state is providing Medicaid eligibility to adults up to the poverty level under a Medicaid waiver.
Figure 2: Distribution of Adults in the Coverage Gap, by State and Region, 2019
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Private Health Insurance Coverage
People may have private coverage through their own or a family members employer, by purchasing coverage directly or through the TRICARE, a health care program for uniformed service members, retirees and their families.
Private coverage rates ranged from 53.3% in New Mexico to 77.8% in Utah .
Among the states with the highest private coverage rates in 2021: Minnesota , New Hampshire , North Dakota and Utah . The rate in New Hampshire was not statistically different from the rates in Minnesota and North Dakota.
In States That Expand Medicaid More Low
The opportunity to expand Medicaid to more low-income adults has opened the door to health coverage for millions of people who may never have had insurance before or who may have been uninsured for a long time. Many have pressing health needs that they have not been able to address because, without coverage, they could not afford to see a doctor or obtain necessary medications. Among the states that have not expanded Medicaid, the median eligibility threshold for parents with dependent children is just 45% of the federal poverty line. That means a parent in a family of three with income of more than $8,905 a year in 2015 could have too much money to qualify for Medicaid . Generally, in states that have not yet expanded, non-elderly adults not raising children do not qualify for Medicaid at all unless they have a disability.
To date, 28 states and the District of Columbia have expanded their Medicaid programs to cover more low-income adults.
According to the latest CMS enrollment report , between October 2013 when the initial Marketplace open enrollment period began, and March 2015, over 12.2 million additional individuals are enrolled in Medicaid and CHIP. Among states that had implemented the Medicaid expansion and were covering newly eligible adults in March 2015, Medicaid and CHIP enrollment rose by approximately 28.1% compared to the July-September 2013 baseline period. States that had not expanded Medicaid reported an increase of about 8.6% over the same period.
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Did North Carolina Expand Medicaid
North Carolina has thus far failed to expand Medicaid, and is one of 11 states where a coverage gap still exists. New state budget calls for a legislative committee to study Medicaid expansion in 2022. North Carolina’s Medicaid program transitioned to a managed care model in July 2021 after several delays.
Option : Create A Federal Public Option To Fill The Gap
Some have advocated for circumventing these holdout states and creating a new, standalone federal Medicaid program that people who fall into this coverage gap could join. It would be kind of like a tailored public option just for this group.
This idea was included in Biden’s 2022 budget,which says, in part: “In States that have not expanded Medicaid, the President has proposed extending coverage to millions of people by providing premium-free, Medicaid-like coverage through a Federal public option, paired with financial incentives to ensure States maintain their existing expansions.”
But it wouldn’t be simple. “That can be quite complex to implement a federal program that’s targeted to just these 2.2 million people across a handful of states,” says Robin Rudowitz, co-director of the Medicaid program at the Kaiser Family Foundation, who wrote a recent analysis of the policy options.
It also may be a heavy lift, politically, says Michener. “Anything that expanded the footprint of the federal government and its role in subsidizing health care would be especially challenging,” she says.
What’s next: This idea was raised as a possible solution in a letter last month from Georgia’s Democratic senators to Senate leaders, and Sen. Raphael Warnock said this week he plans to introduce legislation soon.
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