To their credit, some members of the media have begun examining the plight of those who will still be left behind after enrollment in Obamacare’s state insurance exchanges kicks in on October 1. That not every uninsured person in the American nation will be able to get health insurance should hardly be a surprise. The great coverage expansion, helpful though it may be to millions who have the resources to shop in the exchanges, was never intended to provide universal health insurance, as other countries do.
To review: When Obamacare became law, the CBO estimated that roughly 20 million people would remain uninsured, out of the some 51 million who then had no coverage. Last September the CBO revised its estimate to 30 million uninsured. The coverage expansion contemplated that states would—with the help of federal dollars—expand Medicaid eligibility to adults under age 65 with incomes up to 138 percent of the federal poverty level, catching more people in the insurance net. This year, that would include people with incomes up to $15,900 for a single person and up to $32,500 for a family.
Those with incomes at the poverty level and below were supposed to get Medicaid benefits. About half the states, however, have nixed Medicaid expansion—as the Supreme Court said they could do—and left stranded millions of people with very low incomes and few options for health insurance. They are among the poorest of the poor.
The new hole in the safety net, depending on which state you live in, works this way: In states that don’t expand, people with incomes between 100 and 138 percent of the federal poverty income level can get a tax subsidy to buy health insurance in the state exchanges. But because of the way the law was written, people with incomes under 100 percent of the poverty level are out of luck if they live in the wrong state. That means someone with an income that’s 99 percent of the federal poverty level cannot shop in the state exchange and receive a subsidy the way someone with an income of 101 percent of the federal poverty level can. With most means-tested programs like food stamps, people with incomes over the eligibility line don’t qualify. For health insurance subsidies, it’s people below the line who don’t qualify, a kind of perversity of Obamacare, at least in states that elected not to expand Medicaid.
The idea had been that those below that 100 percent line would get coverage via Medicaid. With the original Obamacare expansion, everyone in this group would have been able to get Medicaid, which actually could offer better benefits than some policies sold in the exchanges. But then, the Supreme Court allowed each state to decide whether to expand its Medicaid program. And about half the states have refused to expand, mostly because their Republican leaders would like to reject Obamacare. They often cite fiscal reasons, although the federal government picks up most of the cost in the early years.
As a result, many people with incomes below the the poverty line are stuck—they are too poor to buy insurance on their own, and without subsidies most will have a tough time paying the entire premiums themselves. Some may be eligible for health benefits under their state’s current Medicaid eligibility rules. In other states, though, these people are left out.
Here’s where the press comes in. Lord knows, we’ve had what seems like a ton of stories on the Supreme Court decision announced a year ago that got health reform into this Medicaid mess, but until recently there has been little coverage of those caught in the insurance no-man’s land. In late May, Robert Pear of The New York Times called attention to this coverage loophole in the new American insurance paradigm. Bruce Lesley, president of First Focus, a child advocacy group, told Pear, “People will be denied assistance because they don’t make enough money. Trying to explain that will be a nightmare.”